Global investors are betting big on the UK’s ‘Build-to-Rent’ sector with equity worth £27.7 billion riding on it for the next five years, according to a latest research report from real estate advisor CBRE.
The research suggests that a quarter of this capital is domestic while almost half originates from North America. The main constraint for investors continues to be a lack of available stock with the ratio of deployable equity to marketed stock currently at 14:1.
Interest has risen from international institutions, to explore opportunities in the UK property market. While London has traditionally been the focus of their attention, the UK’s regional cities are becoming increasingly prominent as American funds begin to explore the market and demonstrate their willingness to move higher up the risk curve in regional cities that offer a strong investment case, the report observed.
Furthermore, while London previously offered most Build-to-Rent development units, the 70,000-strong pipeline of units that are either complete or under construction is now evenly split between the capital and the UK regions.
This is especially evident in areas providing a high volume of excellent quality stock near fast transport hubs. The UK is set to be a huge benefactor if developers can achieve the scale required to meet the growing demand.
In 2016 Multi-family was a $250bn debt and equity market in the US. Institutional investors from overseas destinations, like North America, are looking for new markets to deploy their capital. As such we have launched our Build to Rent Barometer to monitor both domestic and global Investor interest in Build To Rent across the UK.