Housing minister Gavin Barwell has announced the multi-million pound deal will provide more than 2,000 homes and create thousands of jobs.
This latest private rent deal will unlock £400m of development, under the government’s programme to increase investment in purpose built rental properties, and will grow the amount of good quality rental homes in Leeds, Manchester and Birmingham.
The project is one of the largest private rental sector investments in the UK and will receive £45m funding from the government’s new Home Building Fund – which makes money available to help kick-start new development and housebuilding.
Barwell said: “Alongside homeownership, we’re determined to create a bigger, better private rental market to offer greater choice for tenants in a country that works for everyone.
“This is one of the largest private rental sector deals in the UK and will not only create thousands of homes for people in Birmingham, Leeds and Manchester – it will create jobs and opportunities for many hundreds of people.”
Sir Edward Lister, HCA chairman, said: “This massive investment, one of the largest private rented deals this year, shows our determination to get builders building and substantially grow the market in this country.
“We’re working on a number of other deals, with builders of all sizes, and we’re also using our investment and land to attract new entrants to the industry.”
National developer Dandara Group is spearheading the project with support from the government’s housing delivery agency, the Homes and Communities Agency, and banking giant HSBC.
Founder and chairman of the Dandara Group, Dan Tynan, said: “Dandara has already built more than 2,500 properties of this type in the last ten years in the UK, including Scotland’s largest PRS scheme of almost 300 properties in Aberdeen, acquired by LaSalle Investment Management on behalf of a large Pension Fund.
“We are now in a position to actively work with institutions, and independently, to make a sizeable contribution to this market.”
HSBC’s head of housing in the UK, Hugh Taylor said: “We are really pleased to be supporting Dandara alongside the HCA with development finance on this multi-site roll out of their PRS programme.
“It is a significant contribution to the ‘housing challenge’ and is further evidence of PRS beginning to emerge as a distinct asset class.”
It is estimated that up to 1,500 new construction jobs could be created across the three cities from the deal which will provide 2,062 rental homes. These will include:
• 995 homes in Manchester
• 744 homes in Leeds
• 323 homes in Birmingham
The Autumn Statement outlined £7.2bn of investment in housing. This means that the government now expects to double, in real terms, annual capital spending on housing over the course of this Parliament.
The government set out comprehensive housing measures that will address the needs of people at different stages of their lives, ensuring the housing market works for everyone, not just the privileged few.
• Work on the building projects across the three cities will start in January 2017 and is expected to be completed by December 2019. All permissions and contracts are already in place
• Dandara Living will manage the letting and ongoing management of each development using in-house teams based within purpose-built facilities at each site
• The government is committed to building a Northern Powerhouse to help the cities and towns of the North pool their strengths and take on the world. In the last year alone 187,000 jobs were created in the North, a record £13bn investment planned in transport, four historic devolution deals agreed and £2.8bn committed through Growth Deals to build an economy that works for everyone
• The government also has strong ambitions to make the Midlands an Engine for growth in the UK to add an extra £34bn to the region’s economy by 2030 and create 300,000 extra jobs.