Tag Archives: Manchester

New Bailey development, Manchester

L&G invests £16m in Manchester PRS development

Legal & General has forward funded a development of 90 apartments for rent in central Manchester. The 10 storey block will be part of the New Bailey mixed use development, which English Cities Fund and Muse Developments is promoting on a site behind Spinningfields.

L&G won the £16 million project after open market bidding. The site already has planning permission, though some design revisions are now likely to make it better suited to long term rental block management. The scheme designed by architects AHR could start on site this autumn, with the potential for tenants to be moving in to the mix of one, two and three bed apartments before the end of 2016.

“The renaissance of Salford is one of the best success stories in UK urban regeneration,” said L&G’s director of direct investments, Laura Mason. “Situated in a waterside location, within walking distance of Manchester Piccadilly and 200m from Salford Central, we have the ability to provide a new class of rental accommodation, based off fair value rents but with a higher quality offer, and greater tenant service and flexibility.”

This is L&G’s second private rented sector investment, as the company recently took on a regeneration site in Walthamstow, east London where permission has been granted for more than 300 flats. The investor has said it will put up to £1 billion into rental homes over the long term, and is seeking an investment partner “with like-minded international capital” to grow what it expects to be a significant portfolio of private rented homes across the UK.

 

New strategy backs PRS growth in Manchester

Manchester City Council has published a strategy to ensure quality in the private rented sector across its metropolitan area. The Manchester Market Rental Strategy aims to promote good practice, and enhance the role of professional bodies in a bid to drive up standards across the sector, as the numbers of private rented properties grows.

The strategy is a positive step in acknowledging that the private rented sector will be of growing importance to the region in providing homes for more residents in coming years.

Importantly, the council’s document makes a positive suggestion around renaming the sector, and aiming to improve communications. It recommends rebadging the sector “market rental” rather than “private rented”, and says better availability of information via the internet will help improve standards.

“The Manchester rental market has boomed in the last few years – particularly in the city centre – and now offers some of the best accommodation in the city,” said councillor Jeff Smith, executive member for housing and regeneration. “For the vast majority of renters this option works well, and we will continue to support and encourage this market to create wider choice and competition which will drive up standards even higher.”

The strategy notes that a small number of properties at the lower end of the market are those that generate most problems and complaints. The strategy suggests the council will intervene to improve the worst properties and neighbourhoods, with a campaign of proactive enforcement against landlords and agents who fail to respond positively.

“We have a message for those unscrupulous and even criminal landlords that deliberately flout the rules and target vulnerable people who have little or no choice,” warned Smith. “We will use all our available combined powers to target your activities, as you are not welcome in Manchester.”

The strategy, developed with support from the Northern Housing Consortium, follows an assessment of the city’s housing needs, which was set out in a council document published last year, the Residential Growth Prospectus. That suggested the city will need 55,000 new homes by 2027. It signalled the development of a quality private rented sector as one of six key principles to help ease supply, stating: “Good-quality, well-managed accommodation to rent makes an important contribution to the city’s housing stock, accounting for over half of all economically active households in the city centre and fringe.”

The council also notes the same problem in Manchester as elsewhere in the UK, with few institutional and professional landlords, and many amateurs. Says the report: “An important characteristic of the national rental market is the very high number of small landlords owning only one or two properties with relatively few large portfolio holding investors. In Manchester, although we do not know the precise numbers, we are confident the position is similar albeit with an increasing number of larger portfolio holders coming to the market in recent months. With such a pattern of diverse ownership there is an obvious challenge in effectively raising awareness of standards, rights and responsibilities across the whole sector.”

Abu Dhabi funds to transform Manchester with private rented project

Abu Dhabi United Group, which owns Manchester City football club, is to back a £1 billion project to deliver up to 6,000 new homes in central southern Manchester.

The deal is set to leapfrog efforts by other local authorities, and by the mayor of London, to encourage housing development and the growth of a professional private rented sector. While talk in London is now of a talent drain, as workers cannot find affordable places to live, Manchester looks set to deliver.

A partnership with the city council will see an initial phase of more than 830 private rented homes delivered in the Ancoats and New Islington areas, close to the Etihad stadium. The 10 year deal under the name Manchester Life aims to deliver more than 6,000 new homes.

“The planned transformation of the eastern edge of the city centre is the single biggest residential investment Manchester has seen for a generation,” said council leader Richard Leese. “Building thousands of quality new homes will be a fundamental part of our growth story, and will deliver significant socioeconomic impact.”

According to the Manchester Evening News, the deal is significant for the inroads it makes into the city council’s housing development goal; and as a great example of public-private partnership with a major investment.  “Most of homes will be aimed at the 25-39 year old young professionals,” says the publication, “who may struggle to get on the property ladder but are eager to live on the fringes of the city in private rented accommodation.”

Construction on the new homes could start early next year.

Manchester sees strong interest in building homes for rent

Developers in Manchester are looking to grow a substantial private rented sector in the city, to accommodate a growing local population of young professionals.

The city’s universities attract a large number of students each year, and many of them are happy to stay on in the city they have come to call home, once they have completed their courses, so long as they can find a job, and a place to live. The 2011 census recorded a 20% increase in the city’s population over the previous decade.

As a result, there is strong interest in taking a position in a growing rental market – but schemes still need some support. Figures reported by trade magazine Property Week reveal private rental development projects in Manchester accounted for one third of the applications to the Build to Rent scheme from the government, representing a potential 10,000 homes. Build to Rent helps provide interim finance to get projects built, with the government looking to make a commercial return and get their loan back, once projects are completed and let, by a commercial sale to a long term institutional investor.

“The city has been able to retain its graduates, and the private rented sector is very attractive to them, because young people generally don’t have the deposit required for owner occupation,” according to Deborah McLaughlin, north-west director of the Homes & Communities Agency, which is running Build to Rent. Build to Rent is particularly useful as investors can be wary of funding developments before they are completed and rental income is flowing in.