L&G accelerates plans for single-family BTR

Legal & General Capital is launching a new business that will develop single-family rental homes in the suburbs. The business will partner with UK housebuilders to deliver more than 1,000 homes each year from 2024. The schemes will be community-focused and service-led, with a mix of houses and low-density apartments. These will be designed to reflect “new ways of living” post-Covid, such as incorporating home offices and more extensive outdoor space. Alongside L&G’s other housing businesses, the suburban build-to-rent model aims to be operationally carbon net zero by 2030. It will be headed up by L&G director Simon Century, who has led the investment and scale-up of a number of housing businesses including L&G’s affordable housing arm. He will be supported by David Reid, who will act as managing director of the new business, having joined L&G from Rowan Asset Management in January 2020. L&G is recruiting for the team, with a focus on talent from a range of backgrounds including the investment, operational and residential development sectors. L&G highlighted that the investment market is forecast to grow to more than £200bn. Nigel Wilson, chief executive of L&G, said: “In light of the pandemic, it is more important than ever that we deliver the houses that our society needs to address structural shortages across every dimension of the market. “We are still falling far short of the over 300,000 new homes needed each year. “To support this growing need, Legal & General has deployed institutional capital at scale to revolutionise affordable housing, later living, the urban rental market and build-to-sell, and to speed up construction through modular housing. It’s now time that we play a significant role in the suburban single-family rental housing market.” Reid said: “Build-to-rent as a sector has consistently demonstrated value to investors, delivering robust and defensive income streams, suitable for patient capital investment. “It has shown significant resilience throughout the current crisis, with strong rental collection and occupancy rates. With working practices and demands changing rapidly, this is an appropriate time to broaden Legal & General’s BTR investment into the suburban single-family housing market.” L&G launched its build-to-rent fund in 2017. It has more than 5,000 homes in operation or development across the UK’s major towns and cities. To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette