Grainger plc (LON: GRI), the UK’s largest listed residential landlord and leader in the UK private rented sector, has today announced that it has agreed to forward fund a 146-home PRS development (known as ‘build to rent’) with c.12,500 sqft commercial space, in the Hallsville Quarter Development at Canning Town, London for c.£62m. The developer is Linkcity and the building contractor is Bouygues UK. This is the fourth PRS scheme Linkcity and Bouygues UK will deliver for Grainger.
The project builds on Grainger’s existing portfolio of PRS investments in east London and is positioned just 200 metres from Argo Apartments and close to the forthcoming Pontoon Dock scheme, also developed by Linkcity and built by Bouygues UK, which is due to reach practical completion in late 2019. With Abbeville Apartments, Barking also close by, this east London cluster will provide scale and operational efficiencies.
The scheme, which has detailed planning consent, is located within phase 3 of the Hallsville Quarter development, a Joint Venture between Linkcity and the London Borough of Newham. The development is part of London Borough of Newham’s £3.7bn Canning Town and Custom House Regeneration programme. The building is ideally located just 300m from Canning Town station, providing residents with easy access to both Canary Wharf and Central London.
The transaction is subject to the satisfaction of various conditions. Once these have been satisfied and the transaction becomes unconditional, anticipated in late 2019, the scheme will be fully secured and construction will commence. Grainger expects this investment to generate a gross yield on cost of 5.5% once stabilised, with completion anticipated in late 2022. This is a highly attractive investment opportunity in a prominent east London location and meets Grainger’s strict and disciplined investment criteria.
Helen Gordon, Chief Executive of Grainger plc, said:
“We are pleased to further strengthen our London presence with this acquisition, which will deliver 146 high quality homes for rent in London, one of our top target cities. The area is undergoing significant regeneration, and we know from our experience with Argo Apartments that this is a very popular location to live, with such great access to the wider city. Upon completion of this project, Grainger’s east London cluster will comprise 534 purpose-built PRS homes.”