Legal & General Capital is launching its new Suburban Build to Rent (SBTR) business which will develop large scale ‘single-family’ rental communities in suburban locations across the UK. The new housing arm will partner with UK housebuilders and undertake a direct delivery programme to bring forward over 1,000 homes each year from 2024. As an investment market which is forecast to grow to in excess of €223.3bn (£200bn), Legal & General aims to be the UK’s first choice SBTR platform creating much needed, high-quality family homes in areas connected to schools, transport infrastructure and key amenities.
LGC’s SBTR arm is headed up by Simon Century, who has led the investment and scale-up of a number of major housing businesses, such as Legal & General Affordable Homes. He will be supported by David Reid, who will act as Managing Director of the new business, having joined Legal & General from Rowan Asset Management in January 2020. The wider SBTR team is now being established, seeking talent from a diverse range of backgrounds including investment, operational and residential development sectors.
Nigel Wilson, CEO of Legal & General, said: "As we prepare for economic recovery, businesses like ours must continue to invest in our future. In light of the pandemic, it is more important than ever that we deliver the houses that our society needs to address structural shortages across every dimension of the market. We are still falling far short of the over 300,000 new homes needed each year. To support this growing need, Legal & General has deployed institutional capital at scale to revolutionise affordable housing, later living, the urban rental market, build to sell and to speed up construction through modular housing. It’s now time that we play a significant role in the suburban single-family rental housing market. Legal & General have the will, the capital and the deep sector knowledge to invest and drive real impact.”
David Reid, Managing Director, Legal & General Suburban Build to Rent, commented: “Build to Rent as a sector has consistently demonstrated value to investors, delivering robust and defensive income streams, suitable for patient capital investment. It has shown significant resilience throughout the current crisis with strong rental collection and occupancy rates. With working practises and demands changing rapidly, this is an appropriate time to broaden Legal & General’s BTR investment, into the suburban single-family housing market. This is not only about strong investment prospects; it’s about providing high-quality rental housing options for the growing number of families across the UK. Our size and commitment to the housing market across tenures, means we’re in a strong position to lead the way in this nascent sector, delivering well-managed, service-led communities which provide a reliable and positive alternative to homeownership.”