Aviva Investors and Spanish developer Layetana Living have forged a new partnership to develop a BTR portfolio worth in excess of €500m in Spain.
The joint venture has already acquired its first development project – a 71 unit scheme located in the Sants district of Barcelona, which is expected to be delivered at the end of next year.
The partnership, which will create a new operating brand, is looking for further development and forward acquisition projects across major cities in Spain, with a core base in Madrid and Barcelona.
George Fraser-Harding, head of European funds at Aviva Investors, said: “We are pleased to be partnering with Layetana in the dynamic and evolving Spanish residential market, likewise to be extending our build-to-rent investment programme into continental Europe. It is exciting to have already secured our first project in the Catalonia region, where supply constraints and unaffordable prices are increasing rental demand.
“The Spanish market is one which complements our growing European portfolio well, and our focus on delivering an active equity investment to clients. We believe this approach will best-serve our investors, with returns which can better-reflect the changing risks and longer-term structural changes occurring across today’s real estate market.”
Santi Mercadé, CEO at Layetana, added: “The lack of rental supply across most markets in Spain is dramatic and there is huge pent-up demand seeking a quality, affordable product. Our partnership with Aviva Investors creates a platform which will seek to address this imbalance and deliver a portfolio of high-quality apartments priced at economical rents under a single brand which will come to be recognised for its high construction standards, affordable prices and extensive amenity space with a focus on outdoor provision.”
Stuart Osborn, head of European residential investment transactions at Knight Frank, which is advising the JV, added: “We are seeing real momentum in the BTR market in Spain, with investment volumes in the space set to double for 2022. This partnership not only demonstrates the long-term appetite for growth in BTR, but also confidence in the fundamentals which underpin the residential investment market in Spain by committing to deliver market leading professionally managed, institutional product.”
