Scottish homes deal
Springfield partners Sigma to deliver private rented homes
Innes Smith: further revenue stream
Springfield Properties has teamed up with investment adviser Sigma PRS Management, a subsidiary of residential development and urban regeneration specialist, Sigma Capital Group, to deliver private rented homes in Scotland.
The deal represents Springfield’s first partnership for the private rented sector and is targeting the release of hundreds of homes over the coming years.
Under the terms of the agreement, Springfield and Sigma will collaborate to acquire and develop sites in Scotland.
A number of Springfield sites, primarily the Group’s Village developments in Dundee, Edinburgh, Perth and Stirling as well as its development in Inverness, have been identified as having potential for PRS development.
Sigma will buy part of these sites from Springfield and will award Springfield a fixed-cost design and build contract to deliver housing on the acquired land. Following handover of the completed homes by Springfield to Sigma, the homes will be let and managed by Sigma under its ‘Simple Life’ brand.
Other sites will be identified for Sigma to acquire for the purpose of PRS housing development by Springfield.
Earlier this year, Sigma launched the Sigma Scottish PRS Fund, with initial resources of £43m, including £30m investment from the Scottish Government’s Building Scotland Fund in the form of a revolving credit facility. This is the first dedicated vehicle to focus on the creation of new rental homes for families in the private rented sector in Scotland.
Innes Smith, chief executive of Springfield Properties, said: “This agreement stands to accelerate our delivery of homes, particularly on Village developments, and we expect it to provide a further revenue stream, alongside our existing private and affordable housing activity, with good visibility over cash flows.
“It will also increase the number of homes available in the private rented sector.”
Graham Barnet, chief executive of Sigma, said: “This partnership brings significant benefits for both sides, especially in accelerating the rate at which mixed tenure sites can be developed. We look forward to working with Springfield as we develop the partnership and extend our model in Scotland.”