Goodstone Living

Today we announce we have successfully established our first fund following the final close of Goodstone Living Partners 1. Targeting the build-to-rent residential sector and with a develop-to-hold strategy, the fund has over £550m of investment capacity, with equity commitments from a number of international and UK investors including the Northern LGPS. Almost 1,000 homes in Birmingham and Edinburgh are under construction as part of the initial portfolio, and the fund - subject to Article 8 - is focussed on decarbonisation and social value initiatives.   The establishment of the fund is in-line with our strategy of leveraging a sector specialist team to partner institutional capital with high quality living assets across a range of markets and risk profiles.   Iliya Blazic, Chief Executive Officer, Goodstone Living, said:   “The successful launch of our first managed fund and ability to attract high quality institutional capital partners speaks to the confidence global investors have in the underlying fundamentals of the build-to-rent sector, as well as Goodstone Living’s vision of creating a better way to rent.   We are excited to support our capital partners in creating next generation rental communities that integrate innovation, sustainability, wellbeing and customer service into every decision.”   Kevin Etchells, Greater Manchester Pension Fund on behalf of the Northern LGPS, said:   “We are delighted to announce Greater Manchester Pension Fund’s commitment to Goodstone Living Partners 1 alongside our Northern LGPS partners, West Yorkshire and Merseyside pension funds. This partnership already has two developments underway in Birmingham and Edinburgh and we are excited to see the portfolio develop further.   “The UK has an acute under supply of housing and Greater Manchester Pension Fund is proud to contribute to help solve this whilst also hopefully obtaining attractive risk adjusted income returns.”   James Bechely-Crundall, Senior Vice President, Macquarie Asset Management, said:   “Our investment in Goodstone Living on behalf of our managed funds is aligned to our strategy of establishing and incubating specialist real estate managers in sectors we believe are supported by significant structural tailwinds.   “We believe that a scalable market opportunity exists in the UK rental residential sector and that Goodstone Living is well positioned and has the capability to promote decarbonisation initiatives and create social value in the local communities in which it operates.   “We would like to congratulate the team on the closing of their first managed fund, which marks a major milestone in Goodstone Living’s short history. We look forward to continuing to work with the business and its capital partners to support their growth ambitions.”   Read about the fund and Goodstone's ambitions in our interview with Charlotte D’Souza of PERE or visit our website.

Excellent progress at Dockside, our development of 373 build-to-rent homes in Leith, Edinburgh.

Savills' latest research reveals surging investor appetite for the build-to-rent (BTR) sector, marked by a record-breaking pipeline of 110,000 planned homes. It also finds that BTR rents have consistently outperformed the wider private rented market (PRS) thanks to higher quality properties and professional management.    Although the UK BTR is still in its early stages, it offers significant opportunities for investors to scale their portfolios, with new entrants accounting for 50% of BTR investment in 2023. Up from 20% in 2018, this shift reflects a growing interest in the sector, positioning it for substantial growth as it attracts more global capital.   On behalf of our capital partners, Goodstone acquires, develops, and operates next-generation build-to-rent housing across the UK, including current projects in Leith, Edinburgh, and Birmingham's Digbeth district. Our experienced team is dedicated to creating vibrant spaces where people live, work, connect, and relax, while also generating positive and sustainable outcomes for local communities. To read more you can click here: https://lnkd.in/dTfeS74M

Every summer, Edinburgh - where construction of Dockside, our 338 home build-to-rent development is progressing - reinforces its reputation as one of the UK's leading cultural hubs, with the arrival of Edinburgh Fringe Festival. During the next few weeks, visitors from all over the world celebrate the city's rich heritage, cultural and creative offering, with figures from 2022 showing that the globally renowned festival generated over £400 million of revenue for the city from a recorded 3.2 million attendances - a number comparable to the 3.4 million seen at the Qatar World Cup. With significant spending across hospitality, leisure, and retail, the Fringe has supported the creation of 7,150 full-time equivalent roles in the city, underscoring its strong contribution to the Scottish economy. The Fringe’s success is a testament to its economic impact, with every £1 of public money invested yielding a £33 in return, and Goodstone recognises the essential role of high-quality housing to support this fantastic city.

Savills' latest UK Build to Rent Market Update for Q2 2024 reveals a £1.2 billion investment surge, the second-highest Q2 on record. This boost will add nearly 4,500 new Build to Rent (BTR) homes nationwide once completed. With detailed planning permission for nearly 56,000 homes across the UK, Birmingham and Edinburgh – where Goodstone’s projects are already underway – rank among the top locations for consented sites and will lead the next wave of UK construction. Nationwide, there has been a 24% rise in completed BTR homes since Q2 2023, bringing stock now to just over 115,000. BTR homes in the UK’s largest cities are now renting 25% faster than before the pandemic, which demonstrates their growing popularity and their essential role in meeting the national housing targets. To read more you can click here: https://lnkd.in/ejBYpu8A

Birmingham and Edinburgh, the locations of our two schemes, have been identified as some of the UK’s most investable destinations for overseas capital, according to EY. The West Midlands has been ranked as Europe’s seventh best performing region for foreign direct investment (FDI) in the latest EY UK Attractiveness Survey 2024, with Birmingham named the best performing city in the UK after London. In 2023 there were 67 inward investment projects, a 139% increase from last year and its highest number in a decade. This surge, driven by a 50% boost in tech investments, more than doubled the FDI of any other UK city outside London. Edinburgh ranked as the second-best performing city outside of London, securing 32 projects in total. The data highlights the growing commercial appeal of two of the UK’s leading city economies, where institutional investment in real estate is being supported by new infrastructure and investment into high growth sectors such as technology and financial services. To read more you can find the report here: https://lnkd.in/dPzhRvph

Knight Frank's latest Build-to-Rent Market Update predicts a record-breaking year, with total investments surpassing £2.6 billion in the first half of 2024, including £1.3 billion invested in Q2 alone. With a 38% year-on-year increase, the sector - valued at £79 billion in 2024 – is set for significant growth by 2029 and shows no signs of slowing down. Alongside this, over 11,000 homes were completed in the last quarter, accounting for 9% of all new housing deliveries in the UK. According to Knight Frank, the total sector size now stands at 260,844 homes, combining 114,207 completed homes with 62,030 under construction and 84,607 approved for planning permission. Goodstone is a key player in the BTR sector, delivering nearly 1,000 next-generation rental homes across our two sites in Birmingham’s creative district of Digbeth and Leith, Edinburgh. With Goodstone Living Partners 1 closing in 2023 with £550 million in investment capacity, we will continue to drive further value in the sector. To read more you can find the report here: https://lnkd.in/eKCtPwQC

A new report from Savills Operational Capital Markets provides deep insights into the UK build-to-rent market, with data on pipeline, stock composition, renter preferences, investor demand, and the scale of opportunity. With the sector now established for over 10 years, investors and developers such as Goodstone Living are at the forefront of delivering the next generation of build-to-rent housing. Some of the key pillars of our approach include: ▪ A strong focus on decarbonisation across design, development and operations, with technological innovation being key to this ▪ A commitment to long-term and sustainable social value creation in our local communities ▪ An effective use of space and the supporting operations to foster a genuine sense of community ▪ Use of our vertically integrated investment, design, development and operational capabilities ▪ Better homes; Bigger, better spaces; Better, simpler service This is already evident in the build-out of our pipeline, where we have almost 900 homes under construction. By doing this, we can provide a better way to rent and create long-term value for our capital partners. Read the report from Savills below.

The UK and Ireland is the highest priority investment destination for UK and European living sector investors, according to a report from Savills. 61% of institutional investors surveyed identified the region as their top investment destination, up from 38% in 2023. The research highlights the opportunity in the UK, where pension funds, insurers and sovereign wealth funds are realising the potential in counter-cyclical sectors characterised by low institutional penetration rates, attractive supply-demand dynamics, and long-term growth potential, including Build-to-Rent. Managers with specialisms by geography and sector, such as Goodstone, are best placed to support institutional capital in capturing this opportunity. Read more in BTR News

The latest fund manager survey from INREV reveals that available dry powder in real estate grew by almost 8% to €223bn in 2023. Pension funds and insurance companies provide 59% of global real estate equity, while sovereign wealth funds' contribution dropped from 9.1% in 2022 to 8.5% in 2023.   INREV points to the positive impact on investment activity this year, with Iryna Pylypchuk, INREV’s Director of Research and Market Information, commenting: “The substantial amount of dry powder could lead to a rapid uptick in investment flows as the gap between willing buyers and sellers continues to shrink.”   In 2023, Goodstone closed its first fund with over £550m of investment capacity following commitments from UK and international investors. Our first two schemes are being funded by Goodstone Living Partners 1, where almost 1,000 homes are under construction in Birmingham and Edinburgh.    To read more, you can find the report here: https://lnkd.in/euzGjaTK