Grainger Plc (LSE:GRI) has sealed a deal to fund a build-to-rent scheme in Bristol’s ‘Redcliff Quarter’, taking the number of its homes in the city to 900 when complete.
The £128mln agreement will give the company control of the second phase of the development, covering 374 private rental sector (PRS) homes and 94 affordable homes, with a targeted 6% yield on cost once fully let and stabilised.
The scheme, which is less than a 10 minute walk from Temple Meads station, includes six commercial units and outdoor space, as well as 31 car parking spaces.
The shares sit at a 9% discount to our Sep 2022E EPRA NTA per share estimate of 307p, and yield a prospective 2.2%.
Construction will begin in the third quarter with completion expected in 2025.
Grainger shares were little moved by the news by mid-morning, flat at 280.6p, with broker Peel Hunt noting they sit at a 9% discount to its forecast EPRA net tangible assets per share estimate of 307p, and yield a prospective 2.2%.