Investment with Canadian pension fund to begin at its £2.3bn Elephant Park development
Lendlease has struck a deal with a Canadian pension fund to invest £1.5bn in the UK build-to-rent sector.
The partnership with Canadian Pension Plan Investment Board (CPPIB) will begin with £450m spent on the next phase of new homes, which will be for private rent, at Lendlease’s £2.3bn Elephant Park development in London. CPPIB will invest £350m for 80% with Lendlease making up the balance.
This is in addition to the £800m that Lendlease has already committed to housing and infrastructure in the development. Construction has started, with the first homes in this phase due for completion in 2020.
The partnership will also look at opportunities within Lendlease’s wider residential urban regeneration activities in the capital and across the UK under a 50/50 joint venture.
Lendlease will develop, build and manage the build-to-rent homes on behalf of the partnership.
Dan Labbard, chief executive of international operations at Lendlease, said: “In recent decades, structural shifts in the housing market have meant that demand has outstripped supply in the private rented sector, leading to a shortfall of homes in London and across the UK.
“Today’s announcement is a logical next step for us as a business and delivers on our strategy to grow our urban regeneration pipeline and accelerate the delivery of much-needed homes, by working with institutional capital partners to launch this new asset class for Lendlease’s investment platform.”