Invesco Real Estate acquires 99-unit UK forward-funding rental housing project for German mandate

This acquisition is the second transaction for a German institutional investor under a single mandate for European residential real estate. The first deal was the recently announced acquisition of 160 residential units in Madrid. In addition, Invesco is aiming to close two further transactions for this mandate shortly.

The 99 residential units are part of the overarching development plan for the Beaulieu Park site. 70% of these are single-family houses and 30% apartment buildings. The almost 9,800 m² construction project is to receive an EPC energy efficiency rating[1] of A and will include photovoltaic modules, LED lighting, heat pumps and charging stations for electric vehicles.

The development plan for Beaulieu Park envisages that 3,600 families will live there after completion. Residents will have access to new schools, including a planned second primary school, community facilities, a veterinary practice, sports and leisure facilities, as well as cafes and playgrounds. In addition, Beaulieu Park offers more than 176 hectares of public outdoor spaces.

As in large parts of the UK, there are only a few new construction projects for single-family homes in Chelmsford, despite the high demand for rental houses. Build-to-rent units make up just 0.3% of all households in Chelmsford. This points to a significant undersupply, which contributed to an increase in rents of around 12% between August 2022 and August 2023. [2].

The underlying objective of the mandate is to build a diversified residential real estate portfolio with properties in high-density European cities outside Germany, offering sustainable distributions and an attractive total return. The mandate underlines the attractiveness of the European PRS market[3] as well as Invesco Real Estate's long-standing track record in the residential real estate sector.

Rob Johnston, Managing Director, Head of Investments, UK & Nordics at Invesco Real Estate, said: "The UK is suffering from a chronic and long-term shortage of housing, with an average deficit of around 90,000 units per year since 2017.[4] Combined with the steadily increasing number of households nationwide, this excess demand is creating continued pressure on the existing housing stock. Beaulieu Park is a very good example of a high-quality plan to address this deficiency and create a vibrant new community in a prime location in the south-east of the UK. We are pleased to be able to play an important role in this development project on behalf of a German institutional investor."

[1] EPC = Energy Performance Certificate = Energy Performance Certificate
[2] Savills Research, Experian, ONS, Rightmove, Oxford Economics.
[3] PRS = Private Rental Sector
[4] Savills Research, Experian, ONS, Rightmove, Oxford Economics

Invesco Ltd (Ticker NYSE: IVZ) is a global, independent investment management company dedicated to helping people get more out of life. With offices in more than 20 countries, our investment teams offer a comprehensive range of active, passive and alternative investment opportunities. As of June 30, 2024, Invesco managed assets of 1.6 Bn. EUR for clients worldwide. For more information, please visit www.invesco.com/corporate.

Invesco has global expertise and extensive resources in private markets. With our global investment platform and EUR 117 billion of real estate and private credit assets under management, we offer our investors both scale and deep expertise with over 600 investment professionals in 16 countries and over 40 years of innovative experience.

Invesco Real Estate is one of the world's leading real estate investment firms with EUR 79.3 billion in real estate assets under management, 613 employees and 21 regional offices in the US, Europe and Asia. For over 40 years, Invesco Real Estate has actively invested across the risk/return spectrum in direct real estate strategies such as core, debt, value-add and opportunistic, as well as listed real estate assets for over 400 institutional clients. Invesco Real Estate employs over 191 people in Europe across eight offices in London, Munich, Milan, Madrid, Paris, Prague, Luxembourg and Warsaw. Invesco Real Estate manages 205 properties in 14 European countries with assets under management of EUR 15.3 billion. The team has a wealth of experience across all three commercial sectors as well as hotels and residential real estate. As of June 30, 2024.

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Data as of November 27, 2024, unless otherwise stated.

This document is published in Germany and Austria by Invesco Real Estate Management S.a.r.l., President Building, 37A Avenue JF Kennedy, L-1855 Luxembourg, supervised by the Commission de Surveillance du Secteur Financier in Luxembourg, and in Switzerland by Invesco Asset Management (Switzerland) AG, Talacker 34, 8001 Zurich.
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