Investment volumes into build-to-rent assets are expected to beat 2021’s record year, according to preliminary data from CBRE.
In the first six months of 2022, some £1.76m of investment has been ploughed into the BTR sector, an 11% increase on the same period last year.
For the second quarter of 2022, investment volumes reached £900m, up 14% year-on-year from Q2 2021. The strong appetite for stabilised assets continued, accounting for £270m of Q2 2022 investment activity, said CBRE.
Key deals transacted in the second quarter include Swiss Life Asset Managers and Mayfair Capital’s acquisition of the Duet BTR scheme in Salford, the forward funding of Lisbon Street, Leeds by Cortland Group, and Get Living’s forward funding of Sherlock Street, Birmingham.
Capital has been mainly deployed across the regions in the second quarter, following first-quarter activity that was concentrated in London and the South. Around 75% of investment for the second quarter was in prime regional centres.
With £2.6bn of under-offer deals already in the pipeline for H2, CBRE said it was likely this year’s figures would match or exceed 2021’s record £4.4bn of investment.
The majority of activity anticipated for H2 will be in the regions, said CBRE, with some 87% of deals under-offer spread across regional markets. At a sector level, more than £500m of deals under-offer are single family housing.
Scott Cabot, head of UK residential research at CBRE, said: “The UK build-to-rent sector is showing positive momentum and resilience in the face of headwinds such as cost inflation and interest rate increases. The continued investment into regional markets across the UK is reflective of both investors chasing yield and the ongoing undersupply of stock.”
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