Moorfield strikes co-living debut with £300m development strategy

Moorfield Group has teamed up with Funding House to make its first foray into co-living. The new partnership, Zennor, aims to spend £200m-£300m through forward funding residential rental assets over the coming years. It has purchased an 81-bed scheme being delivered by Urbane near Ealing Broadway, west London, for £21m. Moorfield’s investment has been made on behalf of the Moorfield Real Estate Fund IV. The deal is one of the first for Funding House, started by former Empiric Student chief executive Tim Attlee during the pandemic. The strategy includes co-investment from the developer, allowing Urbane to generate additional returns through the value uplift following stabilisation and exit. Ross Netherway, head of origination at Moorfield Group, said: “What we are doing with Zennor is trying to find opportunities to work with developers to help them deliver schemes that they control. “The twist is that we’re doing a forward funding in the way that we normally would and are paying a developer profit, but we’re also giving the developer effectively co-investment in that particular project, so they can benefit from the performance of that investment.” He added: “It creates more alignment between them and us and hopefully builds relationships with these developers that span multiple sites.” Urbane’s scheme will see 24,800 sq ft of co-living in a 10-storey building replacing a single-storey taxi office next to the station on The Mall, W5. The developer bought the site in November 2019 subject to planning and achieved consent for the project in June 2021. Zennor will grow the partnership focusing on co-living, student accommodation and build-to-rent schemes in London, the South East and major regional cities. “I would expect most of what we do through this partnership going forward to be bigger than this first deal,” said Netherway. “We have other opportunities in the pipeline that are a good deal larger than this and I think that ties into the ambition that we have overall to deploy a considerable amount of capital through the partnership.” Attlee added: “We expect this to be the first in a significant series of similar investments for the joint venture in the UK living sector.” The Zennor partnership is Moorfield’s fifth programmatic joint venture set-up, following a £600m partnership with Bricklane to invest in single family housing, a £125m care home deal with Allegra Care and other structures across student accommodation and BTR. To send feedback, e-mail emma.rosser@eg.co.uk or tweet @EmmaARosser or @EGPropertyNews Photo:  Squire & Partners