Build to Rent volumes have increased by 10% in Q3 2022 compared to the previous year, according to global property consultancy Knight Frank. Investment figures hit £1.435bn – a record quarter for the sector in over two years. The last time the Build to Rent sector recorded investment above this level was in Q3 2020, when it reached almost £1.9bn.
Combining figures from the first three quarters of this year puts total Build to Rent investment for the year at £3.165bn; with several significant deals due to exchange in Q4, Knight Frank believes the sector could be in for a record year.
Comparing the first three quarters of 2022 with the same period in 2021, Knight Frank found the deal volumes had increased almost 10% this year – up from £2.895bn for Q1, Q2 and Q3 last year.
The residential Build to Rent investment sector witnessed some significant deals in 2022, including PIC forward-funding a £200m Build to Rent skyscraper in Birmingham for Court Collaboration; Grainger’s acquisition of the 374-unit scheme Redcliff Quarter in Bristol for £128m; L&G’s £200m investment to deliver 715 Build to Rent apartments in Cardiff’s Central Quay; and Greystar’s acquisition of the landmark scheme in Bermondsey, which will deliver 1,548 new homes.
“These latest investment volumes demonstrate investor confidence in the sector’s key fundamentals – it is a robust asset class that outperforms in periods of economic uncertainty. While there are clearly market headwinds that will need careful navigation, investors can be confident that the sector remains attractive, with strong current and forecast rental growth prospects.
“As mortgage costs rise and buy-to-let rental stock declines, we will see demand for high-quality, professionally-managed Build to Rent products continue to increase, providing investors with a resilient and appreciating income stream for years to come.”Nick Pleydell-Bouverie, Head of Residential Investments, Knight Frank