Starwood Capital and Urbeo to create €1bn Irish build-to-rent platform

US investment group Starwood Capital is to partner with Urbeo Residential and the Ireland Strategic Investment Fund (ISIF) to develop a €1 billion build-to-rent platform. The new company, Urbeo, will target a mix of standard, as well as social and supported tenancies, across Dublin and other cities.

Urbeo will seek to partner with builders, developers, and housing associations to deliver new rental housing projects in well-serviced locations, with good connectivity to employment centres.

The platform will begin with a portfolio of three assets totalling 334 private and social units in Dublin, with a pipeline of more than 2,500 units in negotiation or exclusivity. This includes a scheme at Bancroft in Tallaght.

Urbeo, founded by Frank Kenny and Bill Nowlan, says it is focused on "matching investor needs for long-term, stable returns with those of tenants to build stable and sustainable communities of rental housing".

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Mr Kenny said: “We have identified a rich pipeline of assets to acquire, and expect to be busy in the coming months.”

Affordable housing

ISIF will invest €60 million in the platform, which includes its share of the Bancroft Tallaght site. ISIF has taken a 48 per cent stake in the development, which it bought for €30 million last July and has 131 apartments, with Kenny and Nowlan acquiring the rest.

It was expected that more than 30 per cent of the apartments at the development will be let to social and affordable tenants. MD Property, which handles the lettings, currently has a one-bed apartment available for rent at the development for €1,500 a month.

Starwood Capital is one of the largest owners of multi-family housing in the US, with properties in Florida, Colorado, Washington DC, Washington state and California. It will invest in the new platform through Starwood Global Opportunity Fund XI, the firm’s 11th opportunistic real estate fund, which closed in April 2018 with commitments surpassing $7.5 billion.

The build-to-rent sector in the Republic continues to grow at a strong rate, with a recent report from CBRE Research suggesting that international investors with €5 billion to spend are targeting the Irish rental sector.