UK build-to-rent (BTR) investment activity hit a record high in Q2 2023, reveals the latest data from Savills.
The total value of transactions completed in the quarter was £1.26bn – the highest Q2 investment transaction volume ever recorded.
Although the total half-year investment figure of £2.1bn is lower than at the same point last year, Savills said it is higher than all preceding years.
Multifamily units accounted for 58% of BTR investment volumes so far this year, with major transactions including the forward funding of Lower Essex Square, Birmingham (pictured), and L&G completing on two major regional transactions.
Savills said the underlying fundamentals of the UK sector remain strong and continue to attract investment, with rents growing by 10.4% in the year to May 2023.
Polly Simpson, head of multifamily development in the operational capital markets division at Savills, said: “As the demand for housing continues to outpace supply in the rental market, attention is now focused on BTR to bridge the gap and the sector is taking an increasing share of new housing delivery.
“BTR has huge growth potential as investors target inflation-linked returns and the strong performance of operational assets is proving the business model. It’s no surprise developers are increasingly looking to BTR to support housing supply and that the delivery of a variety of BTR products is catering for tenants’ needs, across a range of budgets.”
