Pension Insurance Corporation plc (PIC), has agreed to forward fund £130 million of Muse’s 520-appartment build-to-rent development beside Manchester’s Victoria station, following Colliers International’s acquisition advice on the deal.
Advice from Colliers’ Build-to-Rent team helped to secure the deal for the two-building development which also includes more than 6,000 sqft. of commercial space and 102 car parking spaces beside Manchester’s NOMA. The development will also include amenities reserved for the tenants including a gym, communal lounge, cycle storage and roof garden.
Tracy Blackwell, CEO of Pension Insurance Corporation plc, said: “With a portfolio in excess of £40 billion backing the guaranteed pensions of our c.230,000 policyholders, PIC is a significant and purposeful investor in the UK’s social infrastructure. I am delighted that we have now secured our first Build to Rent project, a significant step as PIC continues to grow. This investment, which will have a positive effect on the local economy, will provide long-term, secure cashflows to back our pension payments in the decades ahead.”
David Burkinshaw, development director at Muse Developments, added: “Reaching completion on the forward funding deal with PIC is a significant milestone for all partners, as we bring forward this innovative gateway development. This deal highlights investor confidence in our long-term vision to transform and repurpose an underutilised site in Manchester city centre.”
Erica D’Souza, senior advisor for the Colliers’ Build-to-Rent team, worked with PIC and Muse to provide financial modelling and design advice on the scheme. She said: “This transaction is testament to the fact that established build-to-rent markets such as Manchester are continuing to see investor confidence due to its strong underlying fundamentals: commuter-friendly locations, strong jobs market and a growth story.
“This development will be significant in the local regeneration providing much-needed accommodation for those who want to live and work in the beating heart of the city. The size of the development and its apartment mix makes it attractive to those living alone, as well as those with young families too. Plus having access to public transport right on your doorstep is an added bonus.”
The wider development, which is also being part funded by Manchester City Council and Homes England through the Housing Infrastructure Fund, benefits from planning permission for a second phase of Grade A office accommodation.
Michael Hawkins, Head of National Office Agency and Development UK Regions at Colliers added: “The city of Manchester is booming. Supply of good quality rental accommodation is needed and we’ve seen determination to meet that need with the improvements to design made during this deal’s inception.
“As quality Grade A office space is in short supply we will continue to advise on new opportunities for creating office locations in the area.”
Colliers’ Valuation team also provided a Red Book for the scheme. Construction firm Vinci is due to start on the site imminently, completion is expected in 2024.
