Mill Group completes £45m innovative PRS deal

Mill Group has completed the creation of a joint venture consortium with Bovis Homes Limited to acquire 190 new homes situated across the south of England.

Mill Group is the majority owner of the consortium and working with Bovis Homes has  secured a senior debt facility from RBS. The Homes and Communities Agency has also provided £8.77m funding for the transaction as part of the Build to Rent Fund. The deal totals £45m. The 190 homes will comprise 110 houses and 80 apartments, designed for couples and families.

The homes will be built in phases over the next 18 months and are located in Cambridge, Bristol, Gloucester, Southampton, Horsham and Hemel Hempstead. The portfolio will be asset managed by Investors in Homes Management Ltd, Mill Group’s residential asset management company.

David Ritchie, Chief Executive of Bovis Homes said:
We are delighted to have agreed to supply 190 of our new homes to the consortium, in which we hold a minor stake. Through achieving this, Bovis Homes is accelerating delivery across a number of its key housing sites thus enhancing shareholder returns.”

Phil Hooper, Head of UK Residential Development said:
"RBS is delighted to support Mill Group, Bovis Homes, and the HCA with a bespoke senior debt funding package in support of this innovative structure."

Margaret Allen, HCA’s Interim Executive Director of Programmes and Recoverable  Investment said:
This investment in the private rented sector is a good example of innovative partnership working using the Build to Rent programme. When complete it will provide private rented choice alongside market sale homes in six areas where is there is a high demand for homes.”

Housing Minister Kris Hopkins said:
Millions of people use the flexible option of renting in the private sector. I want to ensure tenants have a choice of high-quality homes, rented under reasonable terms. So I’m pleased that this deal is complete to build 190 homes across six sites specifically for private rent.

And we're well on track to have work underway on 10,000 homes for rent by 2015.”

David Toplas, Chief Executive of Mill Group, said:
This new joint venture forms a key part of our strategy to build a significant PRS portfolio and demonstrate our commitment to structure, source, finance and invest in the right opportunities.

There is a significant, well-recognised shortage of homes and an ever-growing need for good quality, affordable rental accommodation, and this deal will help tackle that. We are delighted to play our part to encourage greater institutional investor participation, ultimately helping spur an increase in supply of private rental homes.”

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