Sigma reports that it has started work on a £100 million regeneration scheme to build as many as 1,000 home that will be up for rent in Liverpool and Greater Manchester.

The projects have been described as “one of the first and largest private rented sector (PRS) platforms in the UK”.

Sigma, having already worked with Salford and Liverpool City Councils at various redevelopment sites across the North West region, has stated that it eventually aims to build 6,600 homes for rent at a cost of £700 million.

A joint venture for the London-based Gatehouse Bank (a shariah-compliant investment bank owned by the Kuwaiti Securities House) secured £47 million for the project’s first phase, with the remaining £67 million provided by loan from Barclays.

Developed through the existing local authority partnerships, the homes will be built across 14 sites, with ten locations in the Greater Manchester area and four in Liverpool. Countryside Properties will construct the houses, with rentals managed by Direct Lettings (part of the Nottingham-based Shepherd Direct Group).

In 2013, Sigma announced that it was planning 1,450 houses in Salford and Trafford and another 550 in Merseyside, mostly in Liverpool. It is now “exploring with Gatehouse efficient financial structures for the delivery of further phases of new homes.”

Graham Barnet, Chief Executive of Sigma, commented:

“We see considerable potential to create one of the largest new build privately rented residential portfolios in the UK and I am delighted that construction of the first phase of over 900 new homes for rent across Greater Manchester and Liverpool is now starting.”

Scott Nicol, Vice President of Real Estate Investment at Gatehouse Bank, commented: “The complexity of creating a debt and equity funded, institutional scale, private rented platform from scratch hasn’t been an easy task and therefore this transaction is a milestone for the JV and also for the sector in general.”

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Words: Peter Cribley