Regeneration specialist Sigma Capital and its joint venture partner Gatehouse Bank have launched their first private rented sector houses in Salford and Norris Green, part of a 927-home development, and are eyeing-up further sites in the region.
There are 66 family homes available to let in Salford, within Countryside Properties' Lower Broughton scheme, and 152 in the Norris Green estate. There are 927 properties being developed across 14 sites in Greater Manchester and Merseyside.
The Sigma PRS portfolio is being built on land procured and developed by Sigma through its existing local authority partnerships with Liverpool City Council and Salford City Council, and its housebuilding partner, Countryside Properties. Construction is currently underway on a total of six of the 14 sites, with the development of the remaining sites scheduled to begin by early June 2015.
The houses are being marketed under the Difrent brand, which was announced on Friday as part of the official launch of the PRS element of Lower Broughton in Salford. Direct Lettings is the agent for the homes.
According to a Sigma spokesman, in addition to the 14 PRS sites in the first phase with Gatehouse, Sigma is now looking at further sites for phase two.
Under the terms of the joint venture, Sigma earns an initial upfront fee on commencement of construction and thereafter a development management fee, paid quarterly over the duration of the delivery period. On completion, Sigma will earn a quarterly asset management fee, with all fees based on the development cost. Sigma will also retain a share of the net disposal profits on the assets, subject to a minimum return to investors.
Launching the Lower Broughton homes, Cllr Derek Antrobus of Salford Council said: "The council recognises that areas around Salford are fantastic locations. Our job is to make sure our city gets developed to provide homes and vitality. This scheme brings something new; the private rented sector is a new section of the market, and brings forward the innovation and entrepreneurship that we need."
Speaking to Place North West, Paul Staley, director of Direct Lettings, said that one of the advantages of PRS was that an area could be regenerated quicker. "Tenants don't have to worry about securing a mortgage so change can happen faster. It also enables a mixed tenure in an area; we're seeing young professional couples, families, groups of students and older divorcees taking leases on these properties."
According to Staley, Direct Lettings, part of Shepherd Direct Group, is also in conversations with funders to develop sites in the North West, Sheffield and Leeds.