(Alliance News) - Residential property firm Grainger PLC on Monday said it has acquired a forward fund build to rent scheme in the "key target city" Bristol for GBP63.1 million.
Real estate developer Cubex Land Ltd bought the 231-home site in 2016 on behalf of Fiera Real Estate Opportunity Fund IV UK. The fund is a joint venture by London-based property investor Fiera Real Estate UK Ltd that is exclusive to the clients of real estate investor CBRE Global Investment Partners UK Ltd.
Grainger said Cubex Land will be the development manager and Dartford, England-based construction and property services firm Willmott Dixon Construction Ltd will be the contractor, with the acquisition backed by Fiera Real Estate.
"Bristol is a key target city for Grainger and, in line with Grainger's cluster strategy, this new investment generates further economies of scale in conjunction with Grainger's nearby asset, Hawkins & George," Grainger added.
The company said it will now have 425 rental homes in Bristol, including those at nearby Hawkins & George site. Grainger expects the latest investment to generate a gross yield on cost of around 6% when stabilised.
"This acquisition in Bristol is an exciting addition to our growing portfolio of high-quality rental homes in Bristol, a city which meets our strict investment criteria. Demand for high-quality rental homes in Bristol continues to grow, and this scheme will add greater scale to our city cluster, improving our ability to drive efficiencies while delivering a great service to our customers," said Chief Executive Helen Gordon.
Grainger said it expects construction to begin this month, with a completion target of the second half of 2023.
Shares in Grainger were down 0.1% at 288.55 pence each in London on Monday morning.
By Zoe Wickens; zoewickens@alliancenews.com
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Grainger plc (GRI)