Grainger plc Regulatory News (GRI)

Monday 24 July 2017

Grainger plc

("Grainger", the "Company", the "Group")

Acquisition

Joint venture between Grainger and the Local Pensions Partnership acquires PRS build-to-rent development in Pontoon Dock, London

The Pontoon Dock scheme is a 236 home, Private Rented Sector (PRS), build-to-rent scheme being developed by Linkcity in Pontoon Dock, London, procured through the Greater London Authority's (GLA) London Development Panel. It forms a new gateway to the Thames Barrier Park in the London Borough of Newham and will deliver 236 high-quality homes, with the majority specifically built for the private rented sector.

Vesta, a joint venture ('JV') between Grainger plc, the UK's largest listed residential landlord, and the Local Pensions Partnership (LPP), the not-for-profit pension services organisation, has entered into a forward funding agreement with Linkcity (formerly Bouygues Development) to acquire the 154 PRS units within the Pontoon Dock scheme. In addition, Grainger, through its For Profit Registered Provider of social housing, will acquire the remaining 82 units (35%) of the scheme which will be affordable homes.

Grainger will have a 20% equity share of Vesta and will generate long-term fees for management of the PRS units, while LPP will hold the remaining 80% stake. LPP is managing the investment on behalf of the London Pensions Fund Authority (LPFA).

Linkcity is developing the scheme, building on its previous experience of PRS developments including Hallsville Quarter in Canning Town, London Road in Barking, and The Forum in Birmingham. Bouygues UK is the main contractor.

While this investment represents LPFA's first entry into PRS housing, it is part of a £1.2b property portfolio managed by LPP which includes core property investments in PRS and commercial property across the UK.

James Murray, Deputy Mayor for Housing and Residential Development, said:

"I am pleased to see this development is making significant progress, building much-needed new and affordable homes for rent on land owned by the Mayor's office.

"This project shows the public and private sectors, funded in large part by pension investments, working together to help build the homes our city so desperately needs."

Helen Gordon, Chief Executive of Grainger, said:

"We are pleased to announce this innovative partnership between Grainger and the Local Pensions Partnership and Grainger's third project with Linkcity and Bouygues UK, which is unlocking a 0.69 acre site owned by the Greater London Authority to deliver 236 new high-quality rental homes in Pontoon Dock in East London. This investment builds on Grainger's £850 million PRS investment plan and provides us with a local cluster of over 470 rental homes in East London, giving us significant scale."

Linkcity's Managing Director, Nicolas Guérin, said:

"These significant agreements pave the way not only for much-needed new homes but also the continued regeneration of the Royal Docks, new shops, landscaping and improved access to the Thames Barrier Park. Working in partnership is a key part of our approach, and we are excited to be working again with Grainger and the London Pensions Fund Authority to bring another PRS scheme to life."

Sir Merrick Cockell, Chairman of LPFA, said:

"We are delighted to be collaborating with Grainger on this development. This is an excellent example of how pension funds can help bridge the intergenerational divide by investing in assets that deliver benefits to young and older Londoners alike.

"Local pensioners' investments are actively funding housing opportunities for younger London renters. At the same time, the pension fund benefits from the income and capital growth that are provided by property investments, helping to ensure that the fund has a sustainable future and can pay pensions when they are due, both now and into the future."

-ENDS-

For further information:

Grainger plc

Helen Gordon/ Vanessa Simms/ Kurt Mueller

London Office Tel: +44 (0) 20 7940 9500

Newcastle Office Tel: +44 (0) 191 261 1819

Camarco (Grainger PR)

Ginny Pulbrook / Geoffrey Pelham-Lane

Tel: +44 (0) 20 3757 4992/4985

Redleaf Communications (Linkcity PR)

Henry Columbine / Sofie Ford

Tel: +44 (0) 20 7382 4720

linkcity@redleafpr.com 

Local Pensions Partnership

Andy Fleming/Tess Harris

Tel: +44(0) 203 128 8523/6916

lpp@mhpc.com