Funding deal for UK’s first modular build to rent scheme

Aaron Morby 8 years ago
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Homes for rent developer Essential Living has agreed a £60m loan facility for Britain’s first modular build to rent scheme in London.

Creekside Wharf will be one of the tallest offsite-built residential buildings
Creekside Wharf will be one of the tallest offsite-built residential buildings

The four-year club deal, funded equally by Royal Bank of Scotland and HSBC will finance the development of Creekside Wharf in Greenwich.

Designed by Assael Architecture, the 249-homes will include a block designed exclusively for families, with innovative buggy storage, noise insulation and an on-site crèche.

At 23-storeys, Creekside Wharf will be one of the tallest residential buildings to be constructed using off-site methods.  

A quarter of the apartments will be discounted to accommodate low-income households designated by the local council.

Discount market rent homes will be priced from 55% of market rent and blended in with the market-rented apartments.

This will be the first housing development to include discount market rent apartments, which are now set to be rolled out more widely under plans announced by the mayor of London.

Essential Living’s first completed build to rent scheme, Vantage Point in Islington, was funded jointly by the Homes and Communities Agency’s Build to Rent Fund and RBS. The club deal financed three initial projects, also including Farrier House in Bethnal Green and Berkshire House in Maidenhead.

Scott Hammond, managing director at Essential Living, said: “The market is continuing to grow more comfortable with the emerging build to rent business model, and we are delighted to have finalised the debt position to bring forward one of our landmark developments. Against a backdrop of global uncertainty, we believe the defensive nature of residential investment will become increasingly attractive to investors and lenders.”

 Robert Hill, finance director at Essential Living, said: “An increasing diverse debt market has enabled us to secure highly competitive terms. But the combination of delivering both DMR housing and a project built using off-site methods has required some innovative thinking on the part of RBS and HSBC, for which we are extremely grateful.”

Chiara Zuccon, Head of Private Rented Sector at RBS, said: “As part of our £1bn allocation to supporting build to rent, we have already part-funded Vantage Point in Islington, a project that has redefined standards in London’s private rented sector.

“We believe Creekside Wharf, with its provision of affordable housing and its innovative use of modular construction, will be another standout scheme that will greatly enhance the local community and provide much needed rental housing at a range of price-points.”

 

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