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Octopus Real Estate provides £35m development loan to leading retirement build-to-rent provider

31 Oct 2023 By Octopus Real Estate

Octopus Real Estate, part of Octopus Investments and a leading specialist real estate lender and investor, has provided a £35m development finance loan to Birchgrove, the leading operator in the later living build-to-rent (BTR) sector.

The loan will fund the development of Ayrton House to deliver 60 self-contained retirement apartments on the site of an historic former medical research institute in Mill Hill, North London.

The on-site amenity provision will include a restaurant, club room, licensed bar and wellness suite, as well as landscaped gardens.

The Development Lending team at Octopus has historically focused on supporting borrowers who operate in the residential and student accommodation sectors but, over the past year, Octopus has been working on expanding the debt product offering further into the development of other asset classes such as care homes and retirement living where the team already has considerable expertise as an equity investor and landlord.

This loan to Birchgrove is Octopus’s first facility in the Integrated Retirement Community (IRC) sector, and comes as a result of increased collaboration between the Retirement and Development Lending teams.

Honor Barratt, Chief Executive, Birchgrove, commented:

“Ever since Birchgrove’s mid-market rental concept was launched in 2017 the model has gone from strength to strength, enabling over-65s to live flexibly. The acquisition of our ninth site in just six years – including three major developments across London – is testament to how transformative our model has been to later living. We look forward to extending our portfolio even further across London, the Home Counties and beyond.”

Nick White, Head of Development Origination, Octopus Real Estate, concluded:

“We’re on a mission here at Octopus Real Estate to reimagine real estate by providing quality, sustainable homes for people of all ages across the UK. The Development Lending team have been hard at work expanding our product offering to cover all “living” sub-sectors: flats, houses, build-to-rent, shared ownership, student accommodation, care homes, and now retirement communities.

It’s been really satisfying to join the dots across Octopus for this project, and to benefit from the expertise in our specialist Retirement Living team. We look forward to being able to lend on more retirement schemes as the sector continues to grow.”

Octopus Real Estate is a leading investor in the UK IRC for sale sector, currently managing c.£500m across three strategies.

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