In line with its target to manage 10,000 build-to-rent (BTR) homes in the UK, Eco World International Bhd (EWI) is targeting to increase its BTR portfolio to 4,450 homes by 2020.
Currently, the developer's portfolio comprises 1,450 BTR homes that are completed and under construction in London, of which 600 units are situated in phase one of Barking Wharf, 500 units at Kew Bridge and the remaining in East India and Hayes.
"We are targeting [to secure a deal for] another 1,000 [BTR homes] this year and then maybe another 2,000 [units] next year," EWI executive vice chairman Tan Sri Liew Kee Sin said at a briefing on the BTR market held at the developer's London headquarters today.
Liew added that the BTR business will enable the developer to tap a market that offers "huge growth potential" and have a long-term stable recurring income stream.
"We believe this business will provide us recurring income which gives us an edge as a developer as we want to enhance the value [of the BTR properties that we build]," he elaborated, adding that there could be a new brand established under EWI for its BTR business.
According to research by Savills, the BTR market in UK is valued at about £10 billion today and it has the potential to grow to £550 billion when it matures, said EWI residential investment chief operating officer Matthew Pullen.
One of the factors that is fuelling the BTR market, noted Pullen, is housing affordability in urban areas.
Taking London as an example, he said the average house price in the city now is more than 12 times the average income.
"There is also a substantial amount of investors who are seeking assets that offer long-term stable returns looking at BTR investment, especially pension funds," he said.
EWI is also actively looking for land-banking opportunities in London, such as in Newham, Greenwich and Brent to expand its BTR business, he added, and the developer expects to conclude a few land acquisitions this year.
"The Brexit uncertainty is giving us an opportunity to acquire land at scale and enables us to expand as quickly as possible. We are actively looking at sites that can build 500 to 2,500 BTR homes," he said.