Grainger acquires BTR investment at Bristol’s Redcliff Quarter

Grainger announces today that it has agreed to acquire a third Build to Rent investment in Bristol - at Redcliff Quarter.

Grainger's Redcliff Quarter Build to Rent element in Bristol, which has been acquired from Redcliff MCC LLP - backed by ICG Real Estate in partnership with Madison Cairn | BTR News
Grainger's Redcliff Quarter Build to Rent element in Bristol, which has been acquired from Redcliff MCC LLP - backed by ICG Real Estate in partnership with Madison Cairn.

The UK’s largest listed residential landlord – Grainger plc – announces today that it has exchanged conditional contracts to forward fund and acquire the Build to Rent element of the second phase of Redcliff Quarter in Bristol. Grainger has agreed to acquire the scheme for £128m from Redcliff MCC LLP – backed by ICG Real Estate in partnership with Madison Cairn. Knight Frank’s Residential Investment and Affordable Housing teams advised ICG Real Estate and Madison Cairn.

“The sale of Redcliff Quarter is a landmark deal for the city of Bristol – rarely do opportunities such as these become available on the open market. The transaction demonstrates the high level of demand for Build to Rent assets and the requirements for stock in a city which will always be challenged supply wise due to its heritage being so heavily safeguarded. Appetite for Build to Rent developments in Bristol doesn’t seem to be cooling. 

“Acting on behalf of ICG, we are delighted to have been able to broker both the affordable and private elements of the scheme via close collaboration with our London and local teams in Bristol.”

Paul Hawkey, Associate in Knight Frank’s Residential Capital Markets team

The site is located within the central Redcliff district of Bristol and forms part of the second and final phase of Redcliff Quarter – a wider residential-led, mixed use masterplan development. The scheme is a nine-minute walk from Bristol Temple Meads rail station.

ICG is proud to have been involved with the Redcliff regeneration since 2015, most recently securing a planning consent for 468 residential units in partnership with Madison Cairn, and working with Bristol City Council. We are pleased to have played a role in providing much needed housing for the local community and believe Grainger is the right group to take this scheme forward.”

Jai Patel, Managing Director, ICG Real Estate

The acquired Build to Rent element includes 374 homes as well as 94 affordable homes. It also includes c.5,900 sq ft of internal residents’ amenity space; c.21,200 sq ft of external amenity space; c.8,500 sq ft of commercial space; and 31 car parking spaces. An additional six commercial units totalling c.15,800 sq ft have also been acquired as part of the transaction.

Construction is expected to start in Q3 2022, with practical completion of the final element targeted for early 2025. It is anticipated that the scheme, including the commercial element, will generate a gross yield on cost of c.6% once fully let and stabilised.

“There is a serious under-supply of homes in Bristol. By working in partnership with ICG Real Estate and Grainger we have been able to secure planning permission for a revised Redcliff Quarter scheme that saw a substantial increase in the number of homes delivered on the site, compared with the previous consent. Importantly, the new scheme now has 94 affordable homes, which will make a real contribution to helping address Bristol’s housing need.

“We believe this increased value – social and economic – highlights Madison Cairn’s development and asset management expertise benefitting both investors and communities. 

“Redcliff Quarter will be a really vibrant place in the heart of this fantastic city, and we are very glad to have played our part in making this happen.”

Aneil Handa, Managing Director, Madison Cairn

Winvic Construction Limited has been appointed as contractor for the scheme. Winvic built Grainger’s Brook Place development in Sheffield and is also delivering Grainger’s Copper Works scheme in Cardiff.

In line with Grainger’s cluster strategy, Redcliff Quarter builds on its existing Bristol portfolio, which includes Hawkins & George, comprising 194 Build to Rent homes, and Millwrights Place which will comprise 231 Build to Rent homes when complete in early 2024.

“We are very pleased to acquire our third Build to Rent scheme in Bristol which will further strengthen our city cluster, bringing our total investment in the city to nearly 900 homes when complete and driving operational efficiencies, whilst also enabling us to deliver 94 new affordable homes via Grainger Trust, our in-house affordable housing arm.”

Helen Gordon, Chief Executive Officer, Grainger