PIC eyes single-family housing debut

London-based specialist insurer Pension Insurance Corporation is planning to make its first direct investment in UK single-family housing. PIC is exploring forward funding opportunities, as well as the potential for acquiring existing SFH developments and joint ventures with developers in the market. Portfolio deals will also be considered. Hayley Rees, managing director at PIC Capital (pictured), told EG that the main draw is the reduced development risk associated with SFH, compared with multi-family BTR developments. The pension provider already invests in multi-family BTR, as well as purpose-built student accommodation, social housing, affordable housing and senior living. PIC indicated that it intends to make a splash on its debut. Rees said around £60bn of pension money is expected to come into the market, and that a “fair chunk” of that sum will fall to PIC. She said: “When it comes to [making] an entry into a new market, what is of interest to us is not deploying £100m but deploying more than £500m – that is the kind of scale we look at.” However, PIC’s approach to the market will largely depend on site feasibility, said Rees. “What you don’t want is the tail end of a site that housebuilders just can’t get rid of, but something that is designed for SFH,” she said. Key criteria for sites will include minimum EPC B ratings and proximity to necessary infrastructure such as schools and GP surgeries. According to Knight Frank, the SFH market accounted for more than 40% of total BTR investment in 2023, amounting to a record £4.6bn. More than three-quarters of last year’s SFH investment was captured by the regions, while London received the remaining 23%. The news comes after PIC made its first affordable housing investment in November last year, committing £50m to build 125 homes alongside developer London Square. The company also forward funded Court Collaboration’s £200m One Eastside scheme in Birmingham.  PIC has additionally formed a £200m partnership with Octopus Real Estate. The Senior Living Investment Partners venture aims to house up to 2,000 people in the coming years across 10 integrated retirement communities and deliver £1bn into the sector. Photo courtesy of Edelman Smithfield