Developer and property investor Criterion Capital will deliver more than 1,500 apartments into the private rented sector around London and the south east, during 2015. And more than 580 of the new units will be in Croydon.
The company has recently signed construction contracts to begin work on a number of sites, principally converting redundant office buildings into flats for rent. It has projects live in Basildon, Colliers Wood, Croydon and Sutton. All of the completed homes will be offered for rent under Criterion’s Miflats brand, which promises to provide additional services and amenities for tenants including car pooling, cleaning, a concierge, fitness facilities and self storage.
More than a third of the new flats will be delivered in Croydon, where three separate projects are under way. Delta Point, formerly an office block occupied by BT, will convert to provide 404 apartments. Nearby Canterbury House and Bedford Park will produce a further 180 apartments. A £48m trio of design and build contracts has been agreed with contractor Longcross to carry out the conversions. The design and specification of the flats is tailored specifically from the outset for rent, meaning a distinctly different look to apartments being built locally for sale, by developers such as Berkeley.
At Delta Point, work will include fitting a new roof and facades. Longcross London office director Paul Thomas said: “This significant award reinforces our visibility in the capital, establishes us as a lead provider in the PRS market and consolidates our secured workload for the next financial year.”
Elsewhere, in Basildon, Essex, the company is converting a former Ford Motor Company office block to add 384 apartments to rent. This too should be ready for tenants by the end of 2015.
Iain Murray, who joined Criterion Capital several months back as director of PRS, commented: “While last year was about planning and preparation, this year is about construction and delivery. Now that work is under way across our first developments, we are working hard to ensure that we will offer unparalleled management services for when our first tenants move in later this year.”
The 1,500 flats should between them have a capital value of around £500m, and an annual rent roll of around £21m. Criterion is likely to be looking for additional financial partners, possibly selling on completed and stabilised blocks to long term investors such as pension funds, once all the flats are let.
Criterion has secured £115m of funding from backers including Barclays, HSBC and RBS for its projects, and has ambitious plans to deliver a further 5,000 homes by 2020. The company has taken advantage of permitted development rights, under a government initiative that has allowed office blocks to be converted to residential use, without planning permission being needed for the change of use.