Vistry has pre-sold almost 3,000 homes across 70 sites as it continues to reduce its interest in private housebuilding.
The Kent-based company struck a deal that will see private rental sector operator Leaf Living acquire 1,522 residences and registered social landlord Sage Homes buy 1,393 affordable units.
Vistry recently set out plans to fold its housebuilding operations into its partnerships business to allow a greater focus on forward sales. It said this would increase workload visibility and asked suppliers for chunky discounts on agreed prices.
The company, which expects to use existing Homes England grant funding to enable an initial tranche of building work, said the latest deal exemplified its “high return, capital-light partnerships business model”.
Both Sage and Leaf are backed by fund manager Blackstone and investor Regis Group. The acquired units have a gross development value of £819m and are expected to begin construction later this year.
The company expects an initial cash receipt of £160m this financial year, with further staged payments across the development programme.
Chief executive Greg Fitzgerald said: “We have an excellent track record of working in partnership with Leaf and Sage to deliver new homes and I am extremely pleased to have reached agreements to grow these relationships through this exciting, market-leading opportunity.
“Through our unique partnerships model, Vistry is maintaining the momentum of delivery of much-needed affordable housing across the UK.
“Our strategy gives the group significantly greater visibility on earnings than traditional housebuilders and this new partnership and others to follow will help us drive towards our medium-term targets and the delivery of £1bn of shareholder distributions over the next three years.”
Meanwhile, fellow housebuilder Persimmon told the City its trading over the past four months had been in line with expectations.
New-home completions were down 37 per cent on the same period last year but the firm said its “recent planning success” meant it had “a number of new sites progressing through the pipeline”.
The longer-term “fundamentals” of the housing market “remain positive” added Persimmon in a trading update.
Article from constructionnews.co.uk