BTR brand says new tie-up shows not all investors feel cities are dead

15 January 2021 | Investment

BTR brand says new tie-up shows not all investors feel cities are dead

UNCLE, a well-established Build to Rent (BTR) brand owned by Realstar Group, has announced a $1 billion transformative investment to grow to more than $5 billion of assets over the next five years.

Realstar, which owns and manages over $8 billion of assets in Canada and the UK and has a rental portfolio of more than 25,000 apartments, has revealed that QuadReal Property Group has invested around $1 billion (approx £735 million) to acquire a majority interest in eight of its UK assets. Seven of these are in London and one in Manchester.

Four of these assets form part of Realstar’s UNCLE-branded BTR portfolio, including its flagship 45-story tower in the centre of Elephant & Castle, as well its Stockwell, New Cross and Manchester buildings.

Advertisement

QuadReal has already partnered with Realstar on six other UNCLE developments in London, bringing its rapidly growing residential rental portfolio under the UNCLE brand to 10 locations, ‘representing nearly $2.5 billion of assets and growing’.

As well as its investment in the properties, QuadReal is also acquiring an ownership stake in Realstar’s UK management business, which owns the UK rights to the UNCLE brand.

Ryan Prince, the vice-chairman of Realstar Group since 2002 and the founder and chief executive of UNCLE, established the brand in the first place with a mission of bringing a ‘sense of trust and decency’ back to the rental experience. It first launched in May 2017 and, similar to a hotel chain, aims to create neighbourhoods in multiple locations with varying price points in the largest global cities.

“We have worked in partnership with QuadReal and its clients as a trusted business ally for many years,” Prince said. “However, under this new relationship, they will become partners alongside us in the UK on both the brand and operations, as well as the bricks and mortar. This joined-up approach will be a real advantage in achieving our goal to double (and hopefully triple) the size of the UNCLE portfolio over the next five years.”

He added: “Far from being dead when the pandemic passes, cities will continue to be the lifeblood of global communities. UNCLE’s locations, amenities and most importantly service offers city dwellers what they deserve for their hard-earned money. With vaccines now approved and in circulation, we can now see light at the end of the tunnel.”

Jay Kwan, QuadReal’s managing director of Europe, said the latest transaction ‘represents the natural evolution of QuadReal’s investment strategy in Europe’.

“We are deepening our exposure to a sector we believe in, and more solidly aligning ourselves with a world-class partner on the operating side of the business,” Kwan commented. “We are well-positioned to continue expanding UNCLE’s reach in the UK.”

Jonathan Dubois-Phillips, QuadReal’s international president, said QuadReal’s global real estate portfolio now includes over 50,000 residential rental suites, with this commitment reflecting its strong conviction to the asset class. 

BTR brand says new tie-up shows not all investors feel cities are dead

“We continue to see opportunities to improve the communities we invest in – by addressing the fundamental lack of professionally managed rental accommodation,” he added. “We have a long, successful track record investing with the Realstar team and we’re extremely confident that partnering with them in the UK operating company will enhance the breadth and depth of UNCLE’s rental housing options.”

Realstar were advised by Eastdil and QuadReal were advised by JLL.

Last year, Prince outlined what it takes for a BTR development to come to fruition, while in July 2020 UNCLE was part of the Build to Rent bounce-back when it opened its new scheme in Wembley.

<!– LinkedIn –>

This post has originally been featured in Property Investor Today.