Rockspring Property Investment Managers' TransEuropean VI fund has acquired a private rental sector development site in Birmingham city centre with its joint venture partner, US private rented sector operator Atlas Residential.
The asset, which represents a total development cost of £50 mln (€65 mln), was bought from Hallmark BY Development, a joint venture between Bouygues Development (which has subsequently been rebranded Linkcity) and Hallmark Investments, the current landowner.
Linkcity will act as the developer and delivery partner through Thomas Vale Construction, a Bouygues subsidiary, of what will be Birmingham’s first purpose built PRS development.
Located on the former Leisure Box site, the new scheme, which is known as The Beacon, will be adjacent to Birmingham City Council’s major Smithfield regeneration project. Already under construction and due for completion in early 2018, the building will provide a total of 174,000 sq ft (16,165 m2) over 11 floors, providing 334 modern apartments for rent. The development will offer five studios, 262 one-bedroom and 67 two bedroom apartments, underground car parking, a gym and landscaped gardens.
This is Rockspring’s second PRS investment following the acquisition of a 145,544 sq ft (13,520 m2) development in Southampton in August 2015, which is also being undertaken in conjunction with Atlas.
'We are actively looking to replicate this sort of transaction, not just in the UK but elsewhere in Europe where we see evidence of similar themes and trends,' commented Paul Hampton, Rockspring partner and fund director of TEP VI.
Linkcity’s managing director, Nicolas Guérin, added: 'This site has a rich history – it was formerly home to the Silver Blades ice rink which hosted concerts from stars such as Tina Turner – but it has lain dormant for the majority of the last 15 years. This agreement signed with Rockspring’s TransEuropean VI Fund paves the way for us to regenerate this city-centre site, providing much-needed new homes.'
Rockspring’s TEP VI has recently held a fourth close of €428.5 mln, exceeding its fundraising target of €400 mln. The fund has already deployed over €226 mln across five assets in the UK, France, Portugal and Switzerland with a further €177 mln committed. Fundraising will continue until early July, when TEP VI will hold a final close.
The Fund has a high income, capital intensive strategy focused on acquiring value-add opportunities across the office, retail, industrial and residential sectors in both Continental Europe and the UK. It has a maximum gearing of 55%, with a potential gross investment capability of close to €1 bn.
