Nikal Group has secured a forward-funding deal with a prominent PLC for the second phase of Exchange Square in Birmingham City Centre.
Grainger PLC, the UK’s largest listed residential landlord and leader in the UK private rented sector (PRS), has agreed to forward-fund and acquire a 373 apartment development at Exchange Square for £77 million.
The deal confirms Nikal’s intentions to submit new plans for the strategic site, which sits opposite Birmingham Curzon HS2. Planning was achieved in 2016 for 223 apartments across two buildings of seven and 14 storeys. Last year, Nikal announced ambitions to increase the number of units, releasing images of a conceptual 46-storey residential tower to demonstrate the significance it was placing on the scheme.
Whilst the exact details of Nikal’s revised planning application will not be revealed until it is submitted early next year, the company’s Development Director, Darren Jones, who has led negotiations with Grainger, has confirmed that the proposals include at least 35-storeys.
He says, “The agreement with Grainger confirms our commitment to this site and to delivering a landmark development that Birmingham can be proud of. The city skyline is evolving dramatically and whilst our approved lower density proposals suited the site at the time, they no longer reflect the ambitions and aspirations of Birmingham or this important location.
“We’ve been working closely with architects Stephenson Studio and Birmingham City Council for over a year to balance our grand ambitions with what the market wants and what is commercially viable and deliverable within a sensible timeframe. We also had to ensure that the new proposals would complement the wider context of the site and the three towers nearing completion at Exchange Square 1, the tallest of which is 27-storeys.
“We’re very happy with our plans and are absolutely delighted to be able to submit them having finalised our agreement with Grainger PLC. It’s a glowing endorsement for the revised scheme and the end to a fantastic year for Nikal,” he adds.
In a statement issued by Grainger PLC today, Helen Gordon, Chief Executive of Grainger, said, “We are delighted to announce today’s acquisition at Exchange Square in Birmingham for £77m, which will deliver 373 homes for rent in a great central location in one of our top target cities. Birmingham has exciting growth plans and we are pleased to be part of it.”
Waheed Nazir, Corporate Director at Birmingham City Council said, “The skyline in Birmingham City Centre is changing rapidly and investment and confidence is at an all-time high. The desire for people to live in the city forms part of our exciting future. This investment by Grainger is testimony to the global positioning of Birmingham. The residential development at Exchange Square reinforces the direct benefits of HS2 and the Curzon masterplan.”
Exchange Square is a significant new residential and lifestyle destination located at a pivotal point between Birmingham’s Eastside and Central Business District. It lies within the Curzon Masterplan and is just a five-minute walk from all three of Birmingham’s principal railway stations and directly opposite Birmingham Curzon HS2.
Exchange Square is being delivered in two phases. Phase one consists of 603 rental apartments across three buildings of 27, 16 and nine storeys and is currently under construction with the first of the three towers due for handover in January 2019.
Phase One Exchange Square was forwarded funded and acquired for clients by La Salle Investment Management in April 2016 in a deal worth £105 million, the largest forward funded built-to-rent agreement entered into by an Institutional Fund outside of London. Apartments have just been released for rent and are being marketed as ‘Allegro Living’.
A further two phases will be announced in the New Year bringing the total investment at Exchange Square and Masshouse to approaching £500 million.
Please Note: Pictures show Exchange Square Phase 1 which is currently under construction.
(posted Tuesday 18th December 2018)