Border to Coast Pensions Partnership (Border to Coast) has agreed a deal to purchase a portfolio of 866 single-family homes (SFH) from Leaf Living for circa £400m.
The homes are spread across 12 estates in Berkshire, Essex, Hampshire, Hertfordshire, Oxfordshire, Surrey, East Sussex, West Sussex and Wiltshire.
The investment will provide Border to Coast’s underlying LGPS partner funds with exposure to high quality family rental homes, supported by long-term demand for housing across the UK.
Joe McDonnell, chief investment officer at Border to Coast, said: “This acquisition continues the rapid growth of the pool’s UK real estate fund following launch 18 months ago and is the second acquisition into the single-family housing sector. Fifteen of Border to Coast’s partner funds are subscribed to the fund. It is expected to grow to circa £3bn in the next 12 months as the fund continues to invest money on behalf of partner funds into directly held real estate across the UK.
“Our focus on high quality residential property this year is helping reshape our real estate portfolio, future-proofing it for partner funds. Striking a deal of this size is testament to our partnership’s scale and expertise, and we are committed to providing additional value to the LGPS and its members. It is also a prime example of how deploying long-term capital can not only unlock access to strong structural opportunities but also contribute to tackling the country’s infrastructure challenges.”
James McLean, fund manager at Aberdeen Investments, added: “We are strong believers in the long-term UK single-family housing sector, underpinned by robust demand and a shortage of high quality rental homes. At approximately £400m, this is one of the largest and most significant investments we’ve advised on, reflecting our conviction in the sector and our commitment to delivering resilient, long-term returns for Border to Coast’s Partner Funds while supporting the provision of much-needed homes across the UK.”
James Seppala, head of real estate Europe at Blackstone, said: “This transaction reflects strong UK institutional demand for high quality rental housing platforms, which can offer stable long-term income. Patient institutional capital has an important role to play in bringing further investment into professionally managed housing across the UK and we are delighted to partner with Border to Coast on this important transaction.”
Border to Coast was advised by Aberdeen Investments and Savills. CBRE advised Leaf Living on the sale. Border to Coast’s legal advisers were CMS and Mourant. Aberdeen Investments supported the structuring of the deal, with assistance from Mourant.
