Grainger reports strong rental growth and occupancy

Grainger reports strong rental growth and occupancy across its Build to Rent and PRS portfolio, as demand continues to build.

Communal space at Grainger's Pin Yard Build to Rent scheme in Leeds. The company reports reports strong rental growth and occupancy in its trading update to the end of January 2023 | BTR News
Communal space at Grainger's Pin Yard Build to Rent scheme in Leeds.

The UK’s largest listed provider of private rental homes – Grainger plc – provides an update on trading for the four months to the end of January 2023, alongside its AGM which is being held today at its head office in Newcastle upon Tyne. Grainger has a c.£3.2bn operational portfolio of c.10,000 homes and a £1.8bn pipeline of an additional c.7,000 Build to Rent homes – which includes homes in its partnership with TfL. The company reports a like-for-like rental growth of 6.1% and record occupancy levels at 98.7%.

Record lettings performance

Grainger’s operational platform continues to deliver value:

  • Like-for-like rental growth continues to build:
    • Total like-for-like rental growth YTD: 6.1%
    • PRS like-for-like rental growth YTD: 6.1%
      • New Lets YTD: 7.8%
      • Renewals YTD: 5.0%
    • Regulated tenancy like-for-like rental growth YTD: 6.2%
  • Occupancy in PRS portfolio remains at record-high levels
    • Spot occupancy at the end of January 2023: 98.7%
  • Customer enquiries remain at high levels 

Record investment and delivery

Within Grainger’s £1.8bn pipeline, it has a £953m committed pipeline of 3,658 homes which are fully funded, with finance and construction costs fixed, of which there is £479m remaining cost to complete as at 30 September 2022. As part of this, 2023 is a year of record investment and delivery for the company, with c.£300m of capital expenditure on committed developments in 2023 and the delivery of 1,640 new, purpose-built, energy-efficient Build to Rent homes for the year.

Net debt will rise during the year – reflecting net investment in line with plan and previous guidance, whilst its debt is 97% hedged with an average cost of debt of 3.1% (FY22), expected to rise marginally by c.+20bps in FY23.

Grainger’s TfL Build to Rent Partnership makes good progress

Connected Living London – Grainger’s joint venture partnership with Transport for London – is in the process of drawing down the land from TfL for four schemes with full planning approval, representing c.1,240 new Build to Rent homes. These include:

  • Southall, West London
  • Montford Place, Kennington, South London
  • Arnos Grove, North London
  • Nine Elms, South London

“Our £1.8bn pipeline of new, purpose-built, energy-efficient rental homes will see us deliver 1,640 new Build to Rent homes across seven cities in England and Wales in 2023, a year of record delivery and investment for Grainger. 

“Our Build to Rent partnership with Transport for London continues to progress exceptionally well. Through our joint venture, we are in the process of drawing down the land from TfL for four of the schemes, c.1,240 homes, all of which have full planning consent.”

Helen Gordon, Chief Executive, Grainger


Based on Grainger’s continuing strong rental growth, underpinned by demand for private rented housing, and its significant progress in investing in and delivering new rental homes, the company is confident of continuing its strong operational performance.

The outlook for Build to Rent and investment market and the PRS remains resilient relative to most other real estate asset classes, buoyed by the strength in the occupational market and strong rental growth. Whilst not immune to upward pressures on yields, the long-term fundamentals for this sector remain strong. Investor interest in the sector remains high, as strong rental growth offers support to valuations.

Looking back to Grainger’s performance, sales from its regulated tenancy portfolio have historically held up well during previous downturns, proving a high degree of liquidity. Its regulated tenancy portfolio has an inbuilt buffer because of the portfolio’s valuation, which is valued at 17% below vacant possession value.

“Building on last year’s record performance, Grainger has continued to deliver strong performance against all key operational metrics as demand for private rented housing in the UK has continued to grow further, coupled with low levels of supply. We have delivered a strong operational performance during the first four months of our financial year since 1 October 2022. 

“Whilst keeping a very close eye on overall customer affordability levels, like-for-like rental growth has accelerated to 6.1% (PRS: 6.1%; Regulated tenancies: 6.2%) from 5.5% in H2 2022, closely correlated to wage inflation, compared to 3.2% for the same period last year. Our PRS portfolio is effectively fully occupied at 98.7% (February 2022: 97%). 

“Our programme of sales activity has proved resilient to date despite the uncertain outlook in the housing sales market, due to a lower reliance on mortgage purchases and first-time buyers. Sales of vacant homes from our regulated tenancy portfolio, as well as asset recycling across our PRS, regulated tenancy and development portfolios have performed well, generating £48.1m of total proceeds, ahead of the same period last year (£21.1m proceeds). Sales prices achieved from vacant sales were on average 1.2% below September vacant possession values, outperforming the market and reflecting the more resilient nature of these sales due to our typical buyer profile.”

Helen Gordon, Chief Executive, Grainger

The Company will announce its half year results for the six-month period ending 31 March 2023 on 11 May 2023.