Aviva’s global asset manager Aviva Investors is partnering with Spanish developer Layetana Living to build a portfolio of sustainable build-to-rent (BTR) homes in Spain.
Targeting a portfolio of over €500 mln, the partnership has secured its first project, a residential development in Barcelona's Sants district, advised by property consultancy Knight Frank.
Construction work has already commenced on the scheme and should be completed by the end of 2023.
The venture is Aviva’s second in the BTR market and its first in continental Europe, following its partnership with Packaged Living.
The partners are eyeing both development and forward acquisition projects across major cities in Spain, mainly in Madrid and Barcelona, with a preference for locations with a core service offering and strong public transport links.
A new brand will be established under which assets will be managed, with operating services provided by Layetana.
George Fraser-Harding, head of European Funds at Aviva Investors, said: ‘It is exciting to have already secured our first project in the Catalonia region, where supply constraints and unaffordable prices are increasing rental demand. The Spanish market is one which complements our growing European portfolio well and our focus on delivering an active equity investment to clients. We believe this approach will best serve our investors, with returns which can better reflect the changing risks and longer-term structural changes occurring across today’s real estate market.’
Santi Mercadé, CEO at Layetana, commented: ‘The lack of rental supply across most markets in Spain is dramatic and there is huge pent-up demand seeking a quality, affordable product. Our partnership with Aviva Investors creates a platform which will seek to address this imbalance and deliver a portfolio of high-quality apartments priced at economical rents under a single brand which will come to be recognised for its high construction standards, affordable prices and extensive amenity space with a focus on outdoor provision.’
Stuart Osborn, head of European residential investment transactions at Knight Frank added: ‘We are seeing real momentum in the BTR market in Spain, with investment volumes in the space set to double for 2022.’
