Ballymore Group and Oxley Holdings seek investment partnership to enter Build to Rent market

Leading UK developer, Ballymore Group (Ballymore) and Oxley Holdings are seeking an investment partner to work with the companies on their entrance to the Build to Rent market.

The investment is sought as Ballymore announces its strategic commitment to large-scale Build to Rent developments which will be initiated at a new development at Deanston Wharf, London. Deanston Wharf is currently being developed in a 50/50 Joint Venture between Ballymore and Oxley.

Deanston Wharf will be part of the major Royal Wharf regeneration project, a new neighbourhood for East London, jointly developed by Ballymore Group and Oxley Holdings. Forward funding is being sought for 272 units, designed over two buildings, with construction set to begin in early 2019. The properties will be built solely for rental purpose and will offer high quality accommodation at a range of sizes with river-facing views.

The scheme has been designed in response to a strong demand for high quality rental accommodation. Royal Wharf will see the delivery of 3,385 new homes, as well as public realm, a lively high street offering retail and commercial space, parkland and a prime riverside location. Located on a 40 acre site, residents will benefit from fast access to the centre of the capital via a range of nearby transport links. Deanston Wharf will add an additional 769 homes directly adjacent to Royal Wharf, benefitting from its various amenities.

Deanston Wharf represents an extension of a long partnership between Ballymore and Oxley, having previously worked together on Dublin Landings and earlier phases of Royal Wharf.

CBRE and Johns & Co have been appointed by Ballymore and Oxley to provide advisory and transactional consultancy on the project. Research by CBRE highlighted that when compared to neighbouring developments, Ballymore products achieved an average rental value premium of 15% (£psf). In addition, Ballymore rental property was found to command a quicker letting-up rate. Further analysis concluded that these premiums were likely to reflect the superior product and facilities of Ballymore, as well as the attractiveness of an on-site management team.

Ballymore Group’s commitment to delivering high quality private rental accommodation follows investment in to the Build to Rent sector hitting £2.4bn in 2017, reflecting a 33% annual increase.

John Mulryan, Group Managing Director, Ballymore Group, comments:

“Deanston Wharf has strong public transport links, great resident amenities and overlooks Lyle Park and the River Thames. Given these qualities the development sits at an attractive price point to support strong demand and rents from the market.”

“As the Build to Rent market grows in London we at Ballymore believe that we are well placed to be part of this growth. Ballymore has large development and construction teams that finish around 2000 homes a year but more unusually we also manage our own estates. Our estates management team have nearly 10,000 homes across London under management. The combined knowledge and experience within our teams will allow us to design, build and manage purpose-built Build to Rent buildings to the highest standards.”

“Ballymore’s land bank in London could accommodate around 8000 new homes and it is likely many of these will now be built for the rental market.”

Peter Burns, Managing Director, CBRE UK Development, comments:

“There is strong demand for Build to Rent projects in London with interest from both domestic and international capital showing a real thirst for quality product delivered by credible partners.”

“The forward funding of this premium product in a dynamic new London destination is a further signal that Ballymore’s direction of travel is to complement its mixed-use development business. They have one of the best residential pipelines in London which offers them the ability expand into Build to Rent at scale and pace.”

“Ballymore and Oxley’s approach to development will be a welcome addition to the Build to Rent space. Their quality design and build, as well as their longer-term commitment to sites post sales, has made them best in class in the OMS space. This approach is highly complementary to Build to Rent investors hungry for high growth and low maintenance costs.”