Earmarking council-owned sites for new rental homes will help generate new income streams for local authorities with reduced risk compared to commercial property investment, says a leading residential developer.
PLATFORM_, which has one of the largest operational build-to-rent portfolios in the country, urged councils to partner with build-to-rent developers and investors to deliver new homes and secure new sources of income.
Jean-Marc Vandevivere, chief executive of PLATFORM_ and previously head of residential at British Land, said the counter-cyclical nature of build-to-rent made it less risky than traditional commercial property such as offices.
The comments follow an investigation by the Times, which revealed councils had become increasingly active as real estate investors following funding cuts from central government.
Jean-Marc Vandevivere, CEO of PLATFORM_, said: “Many local authorities up and down the country face not only a funding crisis, but also a severe lack of housing. By partnering with build-to-rent investors they can kill two birds with one stone, offering up council-owned land for development of new rental homes, and in return collecting a share of the rent, providing a long-term steady income stream.
“By its very nature, rented housing is an acylical product, and therefore much less risky than commercial property in terms of investment choice.”