British Land is honing its PRS strategy as it considers a major entry into the build-to-rent sector.
The UK-listed REIT with £18.1bn assets under management, of which 98% are split between office and retail and just 2% are residential, is looking at building up an in-house PRS team with the firepower to become one of the UK’s largest operators of rental housing.
The strategy, among other issues, is likely to be discussed by directors at a board meeting next month.
BL’s residential team is exploring the possibility of delivering build-to-rent developments on a large amount of its existing retail assets and mixed-use development sites it has bought up strategically along Crossrail routes.
Canada Water, the 46-acre, mixed-use development project in east London, is due to go in for planning next month, and it is expected the developer will look to re-adjust the plans to give it a greater weight on residential over offices.
Other potential holdings which could help fulfil its residential ambitions include the site of a Tesco superstore in Bromley-by-Bow, where 1,000 homes have previously been consented, and Eden Walk, Kingston, which has consent for 380 homes.
Announcing the acquisition of the 4.9-acre Woolwich Estate in south-east London last week, chief executive Chris Grigg said the proposed retail-led development could also include some PRS units.
Outside London, it could also consider changing retail extension plans in Teeside (80,000 sq ft), Bradford (49,000 sq ft) and Meadowhall in Sheffield (322,000 sq ft) to residential.
Landsec, its main major UK-listed REIT rival, recently hired BTR specialist Tim Treadwell from Willmott Dixon’s residential arm as its new strategy director. However, Landsec said he would be looking at the housing sector in general, and does not have any specific build-to-rent plans.
BL’s potential residential pipeline:
■ Eden Walk, Kingston: permission for 380 homes
■ Tesco site, Bromley-by-Bow: 1,000 homes possible
■ Arcadia Extension, 9-42 The Broadway, Ealing: permission for 186 homes
■ Blossom Street, Shoreditch: permission for 40 homes; probably too small for BTR
■ Canada Water: outline consent for up to 1,030 residential units
■ Woolwich Estate: a 4.9-acre site acquired in February with potential for some PRS units alongside a retail-led scheme
BL portfolio facts:
■ British Land’s portfolio comprises £18.1bn of assets under management, of which it owns £13.5bn.
■ Some 49% of its portfolio is central London offices across three office-led campuses
■ BL’s retail portfolio is focused on regional and local multi-let centres.
■ Residential accounts for just 2% of BL’s portfolio and includes two developments: Clarges Mayfair, W1, a 104,000 sq ft scheme comprising 34 high-end flats for sale; and Hempel Gardens, a collection of 33 residences at the former Hempel Hotel in Bayswater, W1, and Aldgate Place, developed in a joint venture with Barratt Homes.
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