Abrdn has acquired 50 high-quality new-build apartments for private rental at Springfield Place in Tooting, South West London, on behalf of South Yorkshire Pensions Authority.
The mix of one-, two- and three-bedroom homes were built by and acquired from Barratt London. Ringley will lease and manage the scheme going forward.
The development is a short walk from Tooting Broadway underground station and provides 32 acres of public parkland.
James McLean, fund manager at abrdn, said: “We were delighted with the opportunity to invest in high quality, energy efficient new build apartments in an accessible part of South West London. This is the first investment by our clients into the private rented sector which meets their objective of investment into a resilient cashflow, with the aim of consistent returns.”
James Dunne, head of operational real estate at abrdn, added: “We believe that institutional ownership in the UK rental market will expand beyond amenity heavy developments, creating greater choice of rental level. This is a huge potential area of growth which we want to be part of, following the successful model of our European living business.
In areas such as Tooting where the highly accessible location provides significant local amenity, there is less need for expensive onsite facilities. The provision of professionally managed, quality accommodation in long term stable ownership will appeal to a wide range of residents, while passing less cost onto renters.”
Bobby Barnett, partner at Gerald Eve, which advised abrdn on the deal, said: “Pension funds and other institutional investors are increasingly seeing residential rental property as an ideal solution for long-term, low-risk returns while also contributing to ESG goals by providing people with high-quality places to live.
“At the same time, high house prices, inflation and higher interest rates are combining with changing attitudes to make the professional rental sector an attractive choice for both individuals and families. This is being recognised by the bulk housebuilders who are looking to diversify their business models by selling appropriate units in volume to long term landlords.”
Gerald Eve and Addleshaw Goddard advised abrdn and Knight Frank represented Barratt London.
