International investment secured to build 6,600 homes in the UK
This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government
Vince Cable welcomes new £700 million inward investment deal, which will be delivered through UK company Sigma Capital Group.
Business Secretary Vince Cable today (28 November 2013) welcomed a new £700 million inward investment deal, which will be delivered through UK company Sigma Capital Group with backing from international investors, Gatehouse Bank.
The new joint venture will enable Sigma Capital Group, a residential and urban regeneration specialist, to build up to 6,600 new privately rented homes in the UK. Sites for an initial 2,000 homes have already been identified in Liverpool and Greater Manchester.
The deal has been facilitated by UK Trade and Investment’s (UKTI) Regeneration Investment Organisation (RIO) which has been set up to direct investors to credible, industry-backed development opportunities throughout the country.
RIO will be officially launched this evening and will have an independent advisory board comprised of big hitters from British business and government, chaired by former Lord Mayor of the City of London Sir Michael Bear.
Business Secretary, Vince Cable said:
Today’s announcement from Sigma Capital and Gatehouse Bank will create thousands of modern new homes as well as new jobs in Liverpool and Manchester, with similar plans in the pipeline for other regions in the country.
The UK’s inward investment is booming, growing by 11% last year alone. We want to be even more ambitious and make sure that any new investment is spread right across the country - not just in London and the south east.
By ensuring each region has access to good finance opportunities, UKTI’s Regeneration Investment Organisation will help all the UK’s regions fulfil their full potential, helping to build a stronger economy and a fairer society.
Sigma Chief Executive Graham Barnet said:
We have developed an innovative joint venture model designed to deliver high quality homes in areas of the country where rental housing is in extremely short supply. Gatehouse has substantial knowledge of and expertise in the UK property market and has shared our vision for this project. I am delighted that we are now working together to deliver the roll-out of our model, which has the potential to create one of the largest new-build privately rented residential portfolios in the UK.
Underpinning this new venture are our Local Authority Partnerships and I am extremely pleased that this agreement creates the conditions for us to help efficiently deliver their regeneration objectives with high quality new homes. Once bank funding is in place, we look forward to delivering the initial tranche of up to 2,000 new homes in Greater Manchester and Liverpool over the next 2 years.
Chairman of Gatehouse Bank plc, Fahed Boodai, said:
Expanding into the residential market, particularly in the UK, is a significant milestone for Gatehouse Bank. We are seeking investment opportunities in mature and stable markets. This joint venture with Sigma breaks new ground in the UK residential sector and will help to deliver thousands of much needed high quality new homes for rent across the country.
Chairman of RIO Sir Michael Bear said:
We have a really strong supply of regeneration projects in the UK - over £100 billion in capital value. But currently the offer is fragmented with delays and it’s difficult for investors to navigate.
The Regeneration Investment Organisation provides a great opportunity to announce a radical new approach to helping boost investment into the UK and provides a fantastic way of helping investors to find a credible pipeline and range of UK development opportunities and therefore get money into good projects and enable growths across the regions.
Communities Secretary, Eric Pickles said:
This government is working hard to help create new jobs and build more homes for hard-working people.
Today’s announcement with Sigma Capital and Gatehouse Bank will help increase the supply of affordable rented homes across the country. Liverpool and Manchester will be the first to benefit from how the Regeneration Investment Organisation can attract major investments to these shores.
This builds on the steps we are already taking to give people more choice and quality homes at affordable prices through our £1 billion Build to Rent fund and the £10 billion Housing Guarantees scheme.
Recent international investment secured by UKTI in partnership with London and Partners includes the Battersea Power Station project, Chinese investments in London’s Nine Elms and Royal Albert Dock, and Chinese investment into Manchester City Airport. RIO will build on this success by creating an easier point of entry for investors and creating stronger links and better support for new projects throughout the UK.
Notes to Editors
For non media enquiries the Regeneration Investment Organisation can be contacted through Nahid Majid Chief Operating Officer: email firstname.lastname@example.org
The RIO board members are: Michael Newey, RICS President 2013-2014; John Herbert, Global Head of Real Estate & Hospitality, HSBC; Jonathan Harris, Senior MD Real Estate Group in Macquarie Capital EMEA; Jon Milward, Partner, Deloitte; David Partridge, Managing Partner, Argent; Bill Oliver, CEO, St Modwen; Professor Michael Parkinson CBE, Liverpool University; Core Cities; Sir Howard Bernstein, Chief Executive, Manchester City Council; Sir Edward Lister, Deputy Mayor, GLA; Stephen Dance Head, Infrastructure UK; Representatives from the Devolved Administrations.
A first phase of approximately 2,000 residential units is planned with 22 already identified sites in Greater Manchester and Liverpool totalling over 90 acres. The total development cost is of c. £200 million.
Sigma’s and Gatehouse’s contract also provides for the creation of a portfolio of a further 4,600 new homes for the private rented sector housing, taking the total number of new rental homes to some 6,600 with the total development cost estimated at c. £700 million.
In the 2012 Autumn Statement, UKTI was awarded an additional £70 million for each of 2013/14 and 2014/15, enabling the recruitment of more international trade advisers around the country, expansion of existing services including the Trade Access Programme (TAP) and the Overseas Market Introduction Service (OMIS), and support to expand the range of assistance available to UK companies through overseas British chambers of commerce.
The government’s economic policy objective is to achieve ‘strong, sustainable and balanced growth that is more evenly shared across the country and between industries’. It set 4 ambitions in the ‘Plan for Growth’, published at Budget 2011:
- to create the most competitive tax system in the G20
- to make the UK the best place in Europe to start, finance and grow a business
- to encourage investment and exports as a route to a more balanced economy
- to create a more educated workforce that is the most flexible in Europe
Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.
7.UK Trade & Investment (UKTI) is the government department that helps UK-based companies succeed in the global economy. We also help overseas companies bring their high quality investment to the UK’s economy – acknowledged as Europe’s best place from which to succeed in global business. UKTI offers expertise and contacts through its extensive network of specialists in the UK, and in British embassies and other diplomatic offices around the world. We provide companies with the tools they require to be competitive on the world stage. For more information on UKTI, visit www.ukti.gov.uk or visit the online newsroom at www.ukti.gov.uk/media.