The asset management arm of one of the UK’s largest housing associations is preparing to launch a £550m fund for investing in build-to-rent.
PfP Capital, set up a year ago by 60,000-home association Places for People, will aim to forward-fund developments around the country to deliver 3,000 homes.
It will be seeded with three residential schemes worth around £150m, which will be funded through a special purpose vehicle.
Alex Notay, director of product and service innovation at Places for People, will manage the new fund.
Ms Notay said: “This is an exciting time for the sector and the new fund will give investors an unparalleled opportunity to invest with one of the most experienced teams and a manager with a socially conscious DNA.
“Institutions recognise that the UK build-to-rent sector has potential to deliver significant, stable returns over the long term but also that social impact is now a genuine priority for investors. PfP Capital is uniquely qualified to capitalise on that opportunity by leveraging the group’s breadth of experience to deliver 3,000 quality homes in professionally managed build-to-rent communities.”
PfP Capital is already managing funds for the UK’s largest retirement house builder, McCarthy & Stone. In November, according to McCarthy & Stone’s financial results, it aimed to grow its assets under management to more than £750m “in the short to medium term”.
Chris Jones, managing director of PfP Capital, added: “We remain committed to exploring new and innovative ways to deliver investment opportunities within UK real estate that match the varying risk/return profiles of institutional investors.
“We see huge opportunity in being able to offer differentiated products through our PRS [private rented sector] and BTR [build-to-rent] strategies that will offer residents greater quality and choice.
“There is growing interest in the variety of UK housing tenures as an investment asset class and we will continue to develop our business to provide solutions to this demand rooted in Places for People’s socially driven objectives.”
The announcement comes as the government announced new support for the build-to-rent sector in the launch this week of the new National Planning Policy Framework, stipulating that councils should plan for build-to-rent.
At the end of January, institutional investor turned house builder Legal & General acquired land for a build-to-rent scheme in Brighton city centre, the first of its kind in the city.