30 Sep 2020
Legal & General announces £81.5m forward funding of 346 home BTR tower in Glasgow
LGIM Real Assets announces, on behalf of its Build to Rent (BTR) Fund, the forward funding of an £81.5m mixed-use regeneration scheme in Candleriggs Square, Glasgow. The scheme will deliver 346 BTR homes, 17 parking spaces and c.12,800 sq ft of commercial space, helping to meet the city’s demand for high-quality, flexible rental accommodation.
LGIM Real Assets, which entered the BTR sector in 2016, currently owns and operates 15 schemes in 11 UK cities, including over 5,000 homes. Candleriggs Square will mark the Fund’s second investment in Glasgow, last year having committed to the forward funding of a 324-home BTR scheme at neighbouring Buchanan Wharf, again using local developer Drum Property Group to deliver the project.
The 17-storey tower at Candleriggs Square will comprise a mixture of studio, one-, two- and three-bedroom properties, including six duplex penthouse apartments. Typical of schemes within Legal & General’s BTR portfolio, the building will include a dining space, gym, business lounge and games room. Commercial units included within the scheme will all meet a BREEAM ‘Excellent’ rating.
LGIM Real Assets’ £1.9bn BTR Fund has several landmark projects currently under development, including a 1,000-home scheme in Wandsworth, London, and a 200-home scheme in Brighton. The Fund is currently undertaking an international equity raising programme to help meet construction output in line with UK’s requirements for high-quality rental accommodation.
The scheme will make up part of a £300m Drum Property Group plan to transform Candleriggs Square, a 3.6 acre regeneration area which will provide a mix of high-quality homes, offices, hotels, restaurants, amenities and landscaped open space. Approval was granted for a ‘Planning Application in Principle’ for Candleriggs Square by Glasgow City Council in May 2020.
Glasgow faces a significant undersupply of high-quality rental accommodation and, within the coming decade, will see its population increase as it continues to establish itself as one of the UK’s best cities to live and work. The site is located in a prime location and, alongside Legal & General’s Buchanan Wharf scheme, is the city’s only high-density build to rent product.
Through our BTR Fund we want to create the best possible experience for renters, providing high-speed digital connectivity, dedicated workspace and exercise facilities, all of which are essential in a post-covid world.
Dan Batterton, Head of BTR at LGIM Real Assets
The L&G deal is testament to the unwavering commitment and confidence we have placed in both the Candleriggs Square site and Glasgow city centre, even during these most testing of times.
It represents a significant step forward in the long-awaited regeneration of one Glasgow’s most prominent gap sites, driving forward the evolution of Candleriggs Square which has quickly established itself as one of Scotland’s largest and most important commercial and residential development sites.
This will be a huge boost to the area and to local businesses, who are in desperate need of some good news right now. We can now look forward to a once-in-a-generation opportunity to transform a very special area which has always been at the centre of Glasgow’s commercial and social development.
Graeme Bone, Managing Director of Drum Property Group
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LGIM Real Assets
LGIM Real Assets is a division of Legal & General Investment Management (LGIM), one of Europe’s largest institutional asset managers and a major global investor. LGIM manages £1.24tn in assets (as at 30 June 2020), working with a range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors. LGIM Real Assets has AUM of £35.9bn (as 30 June 2020) and is one of the largest private markets investment managers in the UK.
Investing in both debt and equity and across the risk/return spectrum, LGIM Real Assets actively invests in and manages assets across commercial, operational and residential property sectors, as well as infrastructure, real estate, corporate and alternative debt. Taking a long term view in order to future proof our investments, LGIM Real Assets continues to lead the industry in ESG performance, considering all environmental, social and governance issues at asset level as well as portfolio level. During 2020, we are developing a strategy as part of our commitment to net zero carbon emissions across the real estate equity business by 2050, and have also committed to measuring social value across 20% of our platform by the end of the year.
Legal & General
Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with international businesses in the US, Europe, Middle East and Asia. With over £1.2 trillion in total assets under management (as of 30 June 2020), we are the UK’s largest investment manager for corporate pension schemes and a UK market leader in pension risk transfer, life insurance, workplace pensions and retirement income.