M&G’s UK Residential Property Fund is under offer to forward purchase more than 200 private rented sector houses at Drayton Garden Village in west London from Inland Homes for £50m.
It is the third large PRS deal undertaken by the fund since its launch in 2013, taking its PRS portfolio to more than 850 homes.
The latest deal reflects the intense competition in the market, with M&G focusing on assets in outer London and the South East, after having initially bought assets on the fringe of the capital’s centre.
The fund, managed by Alex Greaves, is targeting returns of around 7-9% pa.
To achieve this it has focused on homes valued at between £400 and £600 per sq ft, which are increasingly scarce inside Zone 3. The latest deal will take the fund’s assets under management to £200m, following the July 2014 acquisition of 152 PRS homes in Acton, west London, from Hub for £43.5m and its initial seeding with a £100m portfolio from Berkeley Group.
The institution is expanding its residential team and has appointed Andrew Cook as a fund analyst. Cook, who joins from CBRE, will report to residential investment manager Steve Hollands.
jack.sidders@estatesgazette.com
