Greystar has agreed a partnership with the Abu Dhabi Investment Authority to plough £2.2bn into build-to-rent development in London and its commuter belt.
The tie-up will see the pair target a £1.8bn development pipeline, with equity commitments of up to £750m. A further £400m is attributed to the Fizzy Living business, of which ADIA owns the majority.
Greystar has bought a 16% stake in the company from founding partner Metropolitan Thames Valley. The company sale had been mooted for years, with British Land entering talks to buy the stake in 2018, but negotiations collapsed in 2019. Sale talks restarted this summer.
Greystar will take over management of the 1,000-home portfolio in London. The Fizzy Living brand and 30 employees will move across to Greystar.
The first scheme to be delivered in the partnership will be the Battersea scheme on Lombard Road, SW11. Greystar paid £31m to Big Yellow Self Storage earlier this year for the 0.84-acre site and aims to build around 500 homes.
The new portfolio will be the second for Greystar and ADIA subsidiaries, following on from a 6,000-home strategy in the Netherlands under the OurDomain brand.
Mark Allnutt, senior managing director for Europe at Greystar, said: “We have a highly successful relationship with ADIA in the Netherlands and now have a unique opportunity to create a rental housing portfolio of substantial scale in London and its surrounding commuter towns.
“The Fizzy transaction provides us with day-one access to eight operational assets and a host of new team members that we are pleased to welcome to Greystar. In addition, we will grow the portfolio through our newly formed partnership with ADIA from the ground up.”
Salem Al Darmaki, deputy director of real estate and infrastructure at ADIA, added: “We believe strong long-term fundamentals are driving the demand for purpose-built rental housing in the London area. With the creation of this platform, our objective is to address this specific, growing market opportunity while expanding our relationship with a proven, world-class partner in Greystar.”
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