The €4.2 bn M&G European Property Fund, managed by David Jackson and Simon Ellis, has made its first French private rented sector (PRS) acquisition in Clichy-la-Garenne, north-west Paris.
The fund has acquired the 11,100 m2 Les Boréales development for €85.3 mln as part of the fund’s continued objective to increase residential exposure in Continental Europe.
Les Boréales will consist of 150 apartments in four separate buildings as part of a larger development, which will have a strong focus on sustainability and wellbeing. Light-filled apartments of varying sizes with large window areas and balconies will look on to private gardens and bicycle stores, which will be within walking distance to public transport, schools and retail outlets. The apartments will be ready for occupation late in 2023.
Private sector rental values have increased by 22% over the last 10 years and this buoyancy is expected to continue due to an ongoing housing shortage and steep rental costs in central Paris, which have been unaffected by the Covid-19 pandemic, M&G said.
Affordability constraints in the central Paris have subsequently prompted families to look further afield, pushing prices up in Clichy by 37% over 5 years, making it one of the fastest growing communes versus surrounding areas in north west Paris.
‘This acquisition is another key milestone in the Fund’s recent expansion into residential markets across continental Europe,’ said David Jackson. ‘It follows recent transactions in Finland, the Netherlands and Italy, including PRS, senior living and purpose built student accommodation. This high quality residential portfolio provides strong diversification and long term rental growth potential for our investors.’
