Banks invest in 'build to rent' and want to be landlords

Building houses to rent is a recent "phenomenon" in Portugal, although it is very common in the USA or Germany.


The construction of houses to be placed on the rental market – a model known as 'build to rent' – is a recent 'phenomenon' in countries such as Portugal and Spain, although it is very common in the USA or Germany, for example. A trend that does not seem to be passing alongside banks: in the UK, the Lloyds banking group was the last to enter this sector, with the aspiration to become owner (and landlord) of 50,000 homes over the next decade.

Foreign investors, such as U.S. real estate group Greystar and Goldman Sachs, are also entering this new segment. Australian bank Macquarie launched its own platform, Goodstone Living, in June this year, and announced plans to invest £1 billion in the sector.

"There is a large potential market, growing demand for tenants and limited supply. It's a big market and there's a lot of white space," Dana Gibson, Macquarie's senior ceo and non-executive director of Goodstone, told the Financial Times.

This sector has since been unknown for ten years in the UK, with investment in 'build to rent' reaching £3.5 million last year, a record figure despite the pandemic, according to Savills. Growth has accelerated gradually since a government-commissioned report supported the sector in 2012.

There are around 40,000 units under development in the UK, adding to an existing market of 62,000.