Barings makes second investment in UK PRS Market with GBP57m acquisition in Manchester

Barings Real Estate has made its second investment in the UK private rented sector (PRS) with the acquisition of a site in Manchester to build a 280 unit apartment complex. 

The GBP57 million development is a joint venture with Glenbrook, a property development and investment company specialising in PRS and based in Manchester. The investment is on behalf of a North American institutional investor.
Upon completion, the property in Cornbrook will consist of 280 apartments, including 93 one-bed, 172 two-bed, and 15 three-bed unites, across two 14-storey buildings. The property has been purpose designed for the rental market, and will include a resident’s lounge, garden area, gym and yoga studio all located on the top-floor of the development. A convenience retail store will be located on the ground floor. The property is adjacent to the Cornbrook Metrolink Station, one of the busiest metro stations in the city, with direct access to Manchester City Centre, MediaCity UK, Manchester Airport, and the Etihad Campus. Construction commenced in August 2018 with completion expected for October 2020.
The PRS market in the UK is rapidly emerging as an institutional asset class and addresses the structural imbalances created by decades of undersupply in residential housing, declining average household sizes, and a significant increase in the number of people renting. This is the second investment made by Barings in the UK PRS market this year and follows the acquisition of Liverpool’s landmark property, The Keel, in early October.
Darren Hutchinson, Barings Managing Director and Head of UK Real Estate Transactions, says: “Manchester is a thriving city with a diverse and growing economy which presents interesting investment opportunities. The property in Cornbrook is now our second significant development in the City following Landmark, an 180,000 sq ft office scheme in St Peter’s Square, which is due for completion in Q3 2019. We are pleased to be working with Glenbrook whose experience and track record of developing schemes for institutional investors is key to our partnership.”
Ian Sherry, Director at Glenbrook, says: “Glenbrook are pleased to be working with Barings and continuing our development of PRS accommodation in the UK. Glenbrook has almost 1,000 homes under construction in the North West with a similar number due to start on site next year. Barings investment requirements for this sector and Glenbrook’s proven ability to identify and execute these transactions was a natural fit and we look forward to developing this partnership further.”
Gunther Deutsch, European Head of Transactions at Barings Real Estate, says: “This transaction represents the second PRS transaction of Barings in the UK after a recent acquisition in Liverpool. We are targeting further PRS transactions across Europe in Sweden, Finland, France and Spain as we see positive investment dynamics in these markets. The ability to Co-invest or fund local developers is appealing to facilitate early access to these opportunities.”