M&G Investments has provided £70 million of development finance to investor/developer Westrock to fund four private rented sector residential schemes, reports PDI sister title Real Estate Capital.
The properties are located in the South East of England and form part of the first phase of Westrock’s build-to-rent strategy. The portfolio is under construction and is expected to be completed in the second and third quarters of 2016.
M&G is understood to have provided a fixed-rate loan for two years, comprising one year for construction and one year for stabilisation. The loan-to-cost ratio of the facility is understood to be higher than 60 percent.
Westrock, which has been active in UK real estate for around 30 years, is aiming to develop up to 2,000 units per year in UK city centres. Schemes will be either new-build or conversions and will each contain between 50 and 100 units. Westrock said that it is devising its hold strategy for its PRS assets and that it is considering both listed and unlisted vehicles as well as partnerships with long-term investors.
“Being one of only a few investor-developer-managers in the UK, our eye is firmly on maximising net returns and in the long run we will be able to drive more efficiency and income out of the property, creating valuable, long-term investments,” said Dominic Martin, Westrock’s PRS director.