Urban Splash’s residential fund has committed £25.8m to new rental housing in Manchester and Birmingham.
The Urban Splash Residential Fund has acquired 76 homes, with £11.6m of the funds dedicated to its New Islington scheme in Manchester and the remainder going to Icknield Port Loop in Birmingham (pictured). The latter will see a new rental model established at the Port Loop waterside community.
USR acquired the housing from House by Urban Splash. The fund has also agreed a memorandum of understanding, giving it a first look over the housebuilder’s £800m pipeline.
The investment takes the fund’s total portfolio to 240 homes in the UK, with £40m of equity committed and no debt. The portfolio generates a gross yield of 7.8% and a net yield of 5.5%. Annual returns have exceeded the 10% target.
Fund manager Akeel Malik said: “We are acutely aware of what investors – and ultimately renters – want from modern homes, and we have great confidence in the calibre of House by Urban Splash properties, which are cutting-edge, sustainable and appealing to so many different residents.”
John Forbes, chair of USR, added: “We are in active discussions with institutional investors, and our aim is to establish the fund as a permanent capital vehicle, scaling the portfolio to over £1bn and being one of the most successful residential funds in the UK.”
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