Construction group Kier, and UK infrastructure owner Network Rail are seeking an institutional investment partner to accelerate their development partnership, called Solum, and build more homes for rent.
The pair have already delivered more than 200 homes on sites that Network Rail has adjacent to rail stations. While many of these were sold individually, Solum agreed a portfolio deal in Epsom, selling 63 flats to Fizzy Living for private rented sector use. Fizzy, backed by their own investment partner and supported by Thames Valley Housing Association, are now renting out the apartments under their own brand.
Kier Property’s executive director John Anderson is now looking for a partner to take forward a 150 flat development in Redhill, south of London, ahead of potentially many more sites at other stations.
“We have 150 units in Redhill, and we would be interested to go and see what appetite there is for forward funding,” he told Inside Housing. “Commercially it’s an option we are looking to investigate and if it works, all the developments we do could have an ingredient of PRS.”
Anderson hinted at the rationale behind his bid to open up discussions: “It’s less to do with the funding an institution can provide, and more to do with the fact that they offer the perfect set of ingredients for PRS.”
While private buyers might not appreciate overlooking the railway lines, renters will be more inclined to appreciate the convenience of public transport connections almost on their doorstep. This is something GVA noted in their recent report, suggesting government should “stimulate PRS development on sites less suitable for owner occupier housing”.
“If you look at any wish list for PRS developers, at the very top is a site that has access to transport and ours are in the best possible position in that respect,” added Anderson.
In addition to the Redhill site, Solum’s pipeline includes sites in Haywards Heath, Twickenham and Guildford. Kier has recently launched a new housing division with the aspiration of growing its annual output up to around 4,000 units a year, over the next five years.