Used to fund the building of new homes specifically for private rent, it could help relieve pressure on the housing market by kick-starting stalled developments, as well as make private rental an option of choice for consumers in the future.
Liz Peace, chief executive of the British Property Federation, said: "The speed with which this initiative was conducted demonstrates the HCA’s commitment to making the professional rented sector work, while the weight of response clearly shows the desire from all across the industry to make things happen.
"The challenge now is to get full political support, not just from the Communities department and the fourth housing minister inside 18 months, but from the Treasury who clearly hold the keys to both tax reform and other regulatory measures needed to give investors the confidence they need.
"We need the professional rented sector to stand on its own two feet, so it’s essential we have a business model that works. With the market operating at such a discount, it really is a case of now or never for the professional rented sector."
Nick Jopling, executive director at property advisers CB Richard Ellis, said: "In the USA this sector has seen $340billion of assets traded or refinanced in the last five years; CB Richard Ellis traded $86billion of this institutional-grade residential stock since 2000 which provides us a forensic understanding of the sector and how it could work in the UK.
"The HCA initiative has garnered interest from across Europe, America and the Middle East and we’ve been working with numerous parties who’ve all expressed an interest.
"There are now a large number of pieces on the jigsaw board and it is up to all of us to piece them together and combine the raft of experience and innovation we will need to make this work. No one individual or corporate can deliver this on their own and that is why it is a highly positive situation to have funds, property managers and developers all with their hats in the ring. For the first time these interests are all aligned and it is vital now that we align the momentum and turn potential into reality."
Submissions to the expression of interest process, launched by the HCA last month, have been received from household name UK pension funds and other investors, property developers, fund managers, housing associations and property managers. The HCA and its advisor DTZ are now evaluating the submissions with a view to encouraging organisations to come together to create investment propositions with scale.
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