Lendlease and the Canada Pension Plan Investment Board (CPPIB) have launched an investment partnership that aims to invest £1.5bn in the UK build-to-rent sector.
The partnership will begin with an investment of £450m in the next phase of new homes, which will be for private rent, at Lendlease’s £2.3bn Elephant Park scheme in Elephant & Castle.
The most recent plot at this scheme started construction in November, with 445 homes getting under way, 354 of those for the private market. The first homes are in this phase are expected to be completed in 2020.
CPPIB will invest £350m for 80% and Lendlease will invest the balance.
The partnership will also pursue opportunities within Lendlease’s wider residential urban regeneration activities in London and across the UK under a 50:50 joint venture.
Other Lendlease schemes across the capital include The Timberyard, a 1,132-home project in Deptford, SE8, where construction towards the end of last year.
Lendlease also signed a development agreement with Haringey for the redevelopment of High Road West in Tottenham, N17, earlier this year.
The Love Lane estate redevelopment scheme, next to the redevelopment of White Hart Lane stadium, will provide 2,500 new homes, and is not part of the Haringey Development Vehicle, a partnership between Lendlease and the council.
Lendlease will develop, construct, and manage the build-to-rent homes on behalf of the partnership.
Dan Labbad, chief executive of International Operations at Lendlease, said: “In recent decades, structural shifts in the housing market have meant that demand has outstripped supply in the private rented sector, leading to a shortfall of homes in London and across the UK.
“Today’s delivers on our strategy to expand our urban regeneration pipeline and accelerate the delivery of homes by working with institutional capital partners to launch this new asset class for Lendlease’s investment platform.
“CPPIB is already a highly valued, long-term global partner of Lendlease and we look forward to extending our relationship through this partnership.”
Andrea Orlandi, managing director and head of real estate investments Europe at CPPIB, said: “This investment is a great opportunity for CPPIB to further diversify our European real estate portfolio in a sector we believe is poised for long-term growth.”
CBRE is advising Lendlease.
To send feedback e-mail paul.wellman@egi.co.uk or tweet @paulwellman eg or @estatesgazette
This article was first published on 16 January.
