Crest Nicholson and M&G Real Estate have joined forces to fund the construction of 114 private rental homes in Arborfield Green – a new Berkshire garden village within a short commute of Wokingham and Reading. The M&G UK Residential Property Fund, managed by Alex Greaves, will finance the one and two-bedroom apartments, which will be ready for occupation in late 2019.
Arborfield Green is the third PRS partnership between Crest Nicholson and M&G Real Estate and marks over £100 million of deals made under the investor/house builder arrangement established in 2015. It forms the first part of the partnership’s intended plan to provide 200 build-to-rent units at Arborfield Green and is based on the highly successful US multifamily sector model, where superior location, amenities and management are of utmost importance to residents - a proven business model for institutional investors in the US and increasingly in the UK market.
In line with M&G Real Estate’s existing build-to-rent portfolio, Arborfield Green is served by excellent onsite amenities and transport networks. Residents will have an onsite concierge service and access to a local secondary school and leisure facilities. Central Reading is accessible in thirty minutes and central London in under one hour. Reading Station’s forthcoming Elizabeth Line will provide London-wide connections and will be fully functional by completion of the project.
Previous deals with Crest Nicholson include M&G’s £51.5 million purchase of 227 PRS units at Crest Nicholson’s Kilnwood Vale development, near Crawley in West Sussex – The country’s first low-rise suburban apartment development, centred around a communal club house, tennis court and games area. Currently leasing ahead of target with the final 62 units due to complete shortly, it is also based on the US multifamily sector model.
Alex Greaves, Head of Residential Investment at M&G Real Estate, comments: “The Thames Valley region continues to attract significant investment including provision of offices for major global corporations. This is a high value area of the south east where young people, couples and families struggle to get on the housing ladder - there is a clear and ongoing need for good quality homes for those looking for flexibility and affordability outside of London.
“It is a fantastic opportunity to partner with Crest Nicholson for a third time and I firmly believe that as we do our part to put pension fund money to good use within society, that institutional investors will continue to find the case for residential as compelling as we do.”
Chris Tinker, Board Director at Crest Nicholson, explains: “The delivery of this purpose designed suburban PRS scheme is a further exciting step in Crest Nicholson’s drive to explore new models of housing delivery. Private rented housing, integrated into our suitably located larger urban and suburban developments, has the potential to underpin a meaningful increase in housing output.
“Stimulating new housing markets such as the private rental sector is the only way that the industry and Government will be able to accelerate housing delivery and meet ambitious home building targets. Purpose-designed PRS schemes are complementary to our open market and affordable housing offers, whilst working in partnership with M&G Real Estate will again help us to broaden our tenure base and create diverse communities. As home ownership falls to its lowest level for a quarter of a century, these high quality, professionally owned and managed schemes will also help to ease pressure on the rental market.”