Hines is gearing up to enter the UK single-family housing sector, targeting a portfolio of up to £500m as investor interest in the space grows.
Ross Blair, the firm’s UK head, told EG that Hines aims to build a national portfolio through its value-add fund, Hines European Real Estate Partners 3, exiting with a sale to longer-term institutional capital in five years. The team wants a portfolio with a GDV of between £200m and £500m, with a minimum number of homes per location of 80.
“The UK is the focus right now, but if we can crack it here in the UK, I would be surprised if we don’t get more active elsewhere across Continental Europe,” Blair said. “We like the demographic story here in the UK and, despite the government’s pledge to build a lot more housing, when you dig deeper there’s not necessarily the capital behind that story to make it happen. The land is largely controlled by the housebuilders… It’s very difficult for the delivery of UK housing to be turbocharged in the way that the government might imply.”
The SFH market in the UK accounts for a large proportion of investment in the build-to-rent sector – in the second quarter it accounted for more than half of the £1.3bn invested.
As previously revealed by EG, Pension Insurance Corporation and Patrizia are also looking to deploy capital in the UK SFH sector.
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