Mayor confirms hundreds of new homes for long-term private rent in Elephant and Castle

  • Mace and Realstar to begin building large-scale institutionally backed rental development on Newington Butts site, owned by the Greater London Authority
  • More than 450 new homes, including 278 homes for private rent and 179 low cost homes in the heart of London

The Mayor, Boris Johnson, with developers Mace, and Canadian residential and hospitality owner operators Realstar, has confirmed work is to begin on one of the largest long-term rental developments in the capital at Newington Butts in Elephant and Castle, a site owned by the Greater London Authority.

Over the last decade the number of households privately renting has increased to around two million Londoners, but the capital has few purpose built rented schemes in comparison to North America and Europe. Harnessing the benefits of long term institutional investment, work in Elephant and Castle is set to begin in January with 457 high quality new homes. This includes 278 homes for private rent with a fantastic range of amenities, due to be completed by 2018.

The Mayor has set a number of policies in his housing strategy to encourage institutional investors, such as pension funds and insurance companies, in the long-term rented market, to support longer term leases and more stability for tenants as well as top quality, well designed, new developments. The Newington Butts site, in London’s zone 1, was among 670 hectares of surplus public land taken on by the Mayor in 2012, more than 85 per cent of which has now been moved into the development pipeline. The new development will include 179 low cost homes for rent and shared ownership, being delivered by social housing provider Peabody.

In September the Mayor announced two further Greater London Authority owned sites, Silvertown Way in Canning Town and Pontoon Dock in Newham which are now being brought forward for institutionally backed private rented sector homes.

The Mayor of London, Boris Johnson, said:

“With London’s unprecedented population growth, housing supply and affordability is now our biggest challenge and we need to double the number of homes being built. This requires a radical rethink and it is time for new approaches like this, which not only help build more homes in the heart of the city, but also improve choice and quality for Londoners. Capitalising on London’s undeveloped public land I want to entice more institutional investors to come forward and invest in quality homes for Londoners, boosting the economy and creating thousands of new jobs.”

Chief Operating Officer of Mace Investment, David Grover, said:

“I am delighted to be partnering with Ryan Prince and his team at Realstar, who have a wealth of experience delivering PRS housing that can be applied here and there is a real synergy in our vision for the development. Since Mace was selected as the GLA’s partner for Newington Butts, we have been working through the options for this complex project to deliver much needed housing for the capital. With our other housing partner, Peabody, we are now able to move forward and deliver an iconic piece of real estate, which will be a strong addition to the London skyline, reinforcing the capital’s position as a major city in the world to live in and work.”

Ryan Prince, Vice Chairman of Realstar Group International, said:

“Renting is changing for the better in London and this is the latest example of the development of high quality privately rented accommodation in a landmark, central location. This tower property, which will form part of the wider regeneration of Elephant and Castle, will help to meet the growing demand for this type of accommodation in the capital and become a central part of our growing portfolio of high quality rented property in some of London’s most sought-after areas. This agreement also paves the way for the launch of Realstar Living, a residential owner and operator, which will provide Londoners with even greater choice, convenience and flexibility in the rental market.”

Stephen Howlett, Chief Executive of the Peabody Group, said:

“This landmark development forms a key part of the regeneration of Elephant and Castle, alongside improvements to transport and the creation of thousands of jobs and homes. Peabody is proud to play a major role in this transformation, and are pleased to be working with our partners to help deliver the Mayor’s vision for future living in London. We have been at the heart of Southwark for almost 150 years and continue to provide high quality, affordable homes for Londoners, which will benefit the community for generations to come.”

The Mayor and Southwark Council are currently overseeing a £3 billion transformation of the Elephant and Castle area, the southern gateway to central London, which will see around 5,000 new homes delivered, 1650 of them affordable. The plans, including an overhaul of the transport interchange and the creation of more open spaces, will also create around 5,000 new jobs.