Moorfield Group, the UK real estate private equity fund manager acting on behalf of Moorfield Real Estate Fund IV (MREF IV), has acquired a 93,000 ft2 (8,640 m2), 77 show home portfolio from privately-owned housebuilder Avant Homes for £20 mln (€22.24 mln).
Located across the UK, the show homes have been immediately leased back to Avant Homes on an average three-year term. On expiry of the individual leases, Moorfield will either sell the homes on the open market, leveraging Avant Homes’ sales channels, or rent the homes to complement its existing build-to-rent activities.
Moorfield said that the investment, one of the largest ever of its type in the UK, was in line with its strategy of focusing on strong income stream properties in sectors which fits with its expertise, and where there is typically an underlying supply/demand imbalance.
Moorfield has a track record in the residential sector where it currently invests in senior living (Audley), Build-to-Rent (More. Superenting) and student accommodation (Domain).
Charles Ferguson-Davie, chief investment officer of Moorfield Group, said: 'Despite the volatility caused by the Covid-19 pandemic, we remain convinced that the residential sector will continue to be a resilient asset class, providing ongoing opportunities to generate outperformance on behalf of our investors.
'We have pioneered investment into a range of residential use classes and this innovative transaction provides our investors with further diversification.'
Moorfield Group and Avant Homes have previously worked together, with the former acquiring the developer’s Edinburgh city centre £750 mln mixed-use Quartermile scheme in 2013 for an undisclosed sum. Both parties see this latest deal as paving the way for further strategic partnerships.
Avant Homes chief operating officer, Mark Mitchell, commented: 'This is an excellent transaction for both businesses. We are very pleased to be working with Moorfield Group, having begun discussions at the start of this year.
'As part of our growth strategy, we are exploring a number of other opportunities with Moorfield Group and hope to be able to reveal more detail about what they are in due course.'
Moorfield Group was advised on the transaction by Cushman & Wakefield and Shoosmiths.
