£200m boost for social landlord's Fizzy rent scheme
Published by Max Salsbury for 24dash.com in Housing and also in Finance
The first company in the UK designed specifically to service the needs of young professionals seeking accommodation in the private rented sector has received a capital commitment of up to £200 million.
Fizzy, a subsidiary of social landlord Thames Valley Housing, has been given the boost by Silver Arrow, an investment entity owned by the Abu Dhabi Investment Authority (ADIA).
“As the PRS market is growing quickly with new players emerging all the time, it was a specific objective of ours for Fizzy to have access to a larger capital source within the first two years of operation," said John Garrity, TVH group chair.
"To have achieved this is rewarding as it means that profits generated from this venture are invested back into the association to meet our social purpose. We now look forward to Fizzy proceeding rapidly towards its goal of building a large portfolio of quality private rental accommodation."
The investment means Fizzy has capital available to significantly increase the speed at which it can grow its portfolio. It will continue to purchase new buildings from developers, as well as undertaking the development of its own apartment buildings.
Fizzy was launched in February 2012 with seed capital of £30m provided by TVH. In January 2013 it secured a further £40m of debt funding from Macquarie Capital.
Geeta Nanda, TVH's chief executive, said: “Being one of the first to identify the potential of the PRS, we are naturally delighted to know that the Fizzy concept is as attractive to institutional investors as it was to us when we made our initial investment. This, we believe, is largely to do with the clarity of Fizzy’s focus, which delivers a great solution to the housing needs of a defined demographic.”