French REIT Gecina announced on Friday that it is teaming up with local developer Nexity to develop 4,000 new build-to-rent housing units over the next four years.
The development programme, which will be focused around Paris, the Paris region and other major urban hubs across France, is in line with the firm’s new strategic focus on residential. Gecina first announced in 2018 that it would consider residential assets a core part of the business and that it planned to retain and add to them in the long term.
Earlier this year the firm created a dedicated residential arm for its €3 bn portfolio of residential assets. The package includes 6,000 apartments, representing 409,000 m2. Gecina said at the time that the new subsidiary with 107 staff would open up its capital and allow other investors to gain access to the residential sector.
‘This innovative partnership between two real estate market leaders aims to respond to the need for rental housing, especially in supply-constrained areas. It confirms Gecina’s ambition to accelerate its residential subsidiary’s development, while consolidating Nexity’s leading position and commitment to offering housing for as many people as possible,’ the company said in a statement.
The two partners plan to launch a joint co-development company which will be 60% owned by Nexity and 40% by Gecina. The buildings developed by the partnership will then be acquired by Gecina’s residential subsidiary.
‘This partnership marks a new step forward in Gecina’s ambition to deploy its offering in the rental residential sector,’ said Méka Brunel, Gecina’s chief executive officer. ‘With the creation of this co-development company with Nexity, Gecina will benefit from a powerful and flexible tool to realize its development ambitions, while capitalizing on value-creating investment opportunities, generating scale effects. This agreement will enable us to accelerate the wide-scale deployment of our YouFirst Residence brand for our clients.’
Alain Dinin, Nexity’s chairman and CEO added: ‘We are proud of this partnership with Gecina, which marks a turning point on the French real estate landscape. For Nexity, this represents a new area for growing our residential development business, consolidating our production prospects and opening up numerous possibilities for the future.’
