A joint venture between BlackRock and Outpost Management has obtained a £105.2m loan to fund its acquisition and development of a modular build-to-rent scheme in North Acton, west London.
Precede Capital and QuadReal Property Group provided the financing, which is a three-year whole-loan facility. The deal marks Precede Capital’s first development loan for a modular construction project.
The BlackRock and Outpost jv bought the development, called the Castle, from Tide Construction, which will act as developer and contractor for the scheme. Works are scheduled to complete in August 2025.
The scheme comprises 462 studios in a 32-storey building, with amenities including a roof terrace, cinema, library, gym, co-working space and dining rooms. It will be operated under Outpost’s Enclave brand.
The development is targeting a BREEAM Excellent rating and an EPC score of “A-B”. Precede Capital said it will track the environmental impact and emissions reductions of the scheme, reporting on the latter annually to its ESG and credit committee.
The loan brings the total value of development loans completed by Precede Capital to £1.8bn. This site represents the latest BTR scheme acquired and developed by the BlackRock and Outpost jv, with previous projects including a forward purchase of Enclave: KX in King’s Cross and a forward funding of Lower Essex Square, an Enclave-branded BTR development in Birmingham.
QuadReal acquired a minority shareholding in Precede Capital in 2022 and has committed up to £1bn to deploy into its development loans.
David Jerrard, chief credit officer at Precede Capital, said its first modular construction deal “offers strong advantages including increased efficiency while limiting the impact of key risks to the project”.
He added: “This financing underpins our core commitments to address growing demand for build-to-rent assets in London and invest in high-quality sustainable assets, underscoring our ability to finance high-calibre developments across the UK.”
Kristian Branum-Burns, QuadReal’s senior vice-president for Europe, said: “The living sector continues to be a key conviction of QuadReal’s global investment strategy. Enclave fits within our strategy, delivering a high-quality, service-led residential scheme in the heart of a thriving pocket of west London.”
Christy Hayes, chief executive of Tide Construction, said: “This deal demonstrates the level of quality, sustainability and sophistication that Tide and Vision’s volumetric technology can deliver, supporting the much-needed provision of housing to the UK.”
Precede Capital was advised by law firm Eversheds Sutherland. Dalbergia provided construction due diligence for the lenders, CBRE acted on valuation matters and Longevity Partners advised on ESG due diligence. JLL and law firm Simmons & Simmons acted for BlackRock and Outpost Management.
Image © HTA Design/Outpost Management
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