Legal & General has today announced that it will be creating over 170 new Build to Rent (BTR) homes in Bath, as part its wider approach to address the UK’s housing shortage, having acquired a city centre development site for £47.5m.
21 Mar 2017
Legal & General now has a total housing pipeline of over 70,000 units, of which 1,200 are BTR homes.
This is Legal & General’s fourth BTR scheme, with existing sites progressing well in Bristol, Salford and Walthamstow. It has £1bn of firepower to invest in developing new large scale rental development properties which will provide rental income for pension funds to pay their pensioners, and create an economic stimulus for UK urban regeneration areas, delivering new jobs and growth. Legal & General has invested £10bn in UK infrastructure, with an aim to invest £15bn.
The Roseberry Place development is ideally located on brownfield land in the Bath City Riverside Enterprise Area on the river, which represents the best opportunity to accommodate new development growth in the city. The site will comprise 171 apartments, 126 car parking spaces and 17,000 sq ft of retail space. It already benefits from outline planning and Legal & General will be working closely with the developer to provide high-quality rental accommodation within a City in much need of additional housing supply.
Dan Batterton, BTR Fund Manager at LGIM Real Assets, said: “This acquisition is a prime example of the type of compelling opportunities there are in the market at the moment, as we continue to build our pipeline. We are targeting well-located sites where there is the opportunity to influence all aspects of design and construction from the start to create a best-in-class product that will provide a positive lifestyle choice for elective renters. We remain on track to deliver on the growth plans for our major Build to Rent platform focused on holding assets for the long-term on behalf of investors.”
The Bath scheme has been acquired by LGIM Real Assets on behalf of its BTR fund, together with its joint venture partnership between Legal & General Capital (LGC), the Group’s principal investment arm, and PGGM, the Dutch Pension Fund Manager.
James Lidgate, Director of Housing at Legal & General Capital, said: “This latest acquisition is in line with our strategy of increasing our direct investment exposure to housing and establishing Build to Rent as an institutional asset class – investing Legal & General’s balance sheet capital, alongside other third party capital, to achieve high-quality risk adjusted returns.
“This scheme is an excellent example of the partnership’s asset acquisition strategy - investing in long term sustainable urban schemes that support wider urban regeneration by better utilising the local existing infrastructure, and maximising land density in areas where there is a shortage of housing supply.”
Cushman & Wakefield acted for L&G on this transaction.
Legal & General entered the BTR market in January 2016, through a £600m partnership between Legal & General Capital and PGGM. Committed to raising the standard of UK renting across the board, LGIM Real Assets in December 2016 raised a further £170 million of equity investment to launch an open-ended Build to Rent (BTR) fund. The fund sits alongside the partnership between LGC and PGGM and has £1bn to invest in developing new large scale rental development properties. It currently has over 1,000 build to rent homes under construction, or in planning, with an initial aim of building over 4,000.
Notes to editors
Legal & General Investment Management Real Assets (LGIMRA) is a division of Legal & General Investment Management (LGIM), one of Europe’s largest institutional asset managers and a major global investor. LGIM manages £1.28tn in assets (as at 31 December 2020), working with a range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors.
LGIM Real Assets has assets under management of £36.3bn (as at 31 December 2020) and is one of the largest private markets investment managers in the UK. Investing in both debt and equity and across the risk/return spectrum, LGIM Real Assets actively invests in and manages assets across commercial, operational and residential property sectors, as well as infrastructure, real estate, corporate and alternative debt.
Taking a long term view in order to future proof our investments, LGIM Real Assets continues to lead the industry in ESG performance, considering all environmental, social and governance issues at asset level as well as portfolio level. In 2021, we are implementing a strategy as part of our commitment to net zero carbon emissions across the real estate equity business by 2050, and have also committed to measuring social value across 20% of our platform by the end of the year.
(As of June 2021)
The value of an investment and any income taken from it is not guaranteed and can go down as well as up, you may not get back the amount you originally invested. Past performance is no guarantee of future results. You should consult an independent investment adviser prior to making any investment in order to determine its suitability to your circumstances.
Legal & General Capital (LGC) is Legal & General Group’s alternative asset platform, creating assets for Legal & General Retirement and third-party clients in order to achieve improved risk-adjusted returns for our shareholders. LGC has built its capabilities in a range of alternative sectors, including in residential property; specialist commercial real estate; clean energy; alternative credit; and venture capital, which are all supported by long-term structural growth drivers, meet a financing gap and respond to a scarcity of supply that is underpinned by enduring societal needs.
Its purpose is to invest society’s capital for society’s benefit. Investing in the real economy and supporting the Group’s focus on climate and inclusive capitalism, LGC’s investments create jobs, change lives and contribute towards a net zero carbon future.
Legal & General has invested over £29bn in levelling-up regional economies, including through major UK-wide regeneration schemes and has recently made a commitment to enable all its new homes to operate at net zero carbon emissions from 2030.
(As of June 2021)