Later living business Pegasus is moving towards becoming a build to rent (BtR) developer and operator.
It has secured an investment loan facility from Barclays to support its growth and has a pipeline consisting of six development sites across the country, creating over 300 homes, due to start construction in early 2024.
The communities will be available solely for rent to the over 60s. This is on top of its existing 26 later living communities, which already offer a rental option.
‘Our move to become the market leading BtR developer and operator for seniors comes as a direct result of our customers selecting rental as their preferred option when choosing a Pegasus home,’ said Pegasus chief executive Steve Bangs. ‘Renting is flexible, allowing our customers to be more agile when moving, as well as providing greater financial freedom and the ability to choose to move closer to family and friends. The need is clearly there, and we are responding to it.’
In research published by in October, Knight Frank forecasted the number of private rental units to rise 114% in next five years, from more than 5,000 to over 10,500 by 2025.
According to LaingBusson’s Retirement Housing report, over 70% of retirement living development between 2015 and 2019 was undertaken by three private sale companies: McCarthy & Stone, Churchill and Lifestory, which Pegasus is part of alongside Renaissance and Anthology.
Steve Secker, author of the report and director of LaingBuisson’s Retirement Housing Conference, said: ‘With their investment from Barclays it’s a strong endorsement of the increasing developer appetite for rental in the specialist older people’s housing market. Pegasus have traditionally not been associated with the housing with care end of the retirement housing market where most of the private rental offerings have been to date so it will be interesting to see how their offer develops.’
Pegasus’ Latheram House community in Cheltenham, Gloucestershire, has 83% renters as occupants.
Bangs added: ‘I am very excited to be leading the business through the transition to become the market leading BtR developer and operator in the seniors market. As we prepare for this change, we will continue to offer both home purchase or renting as options across all 26 existing communities available to move into today, before moving to be exclusively BtR.’
Lifestory is working with Savills to source a strategic investment partner to help in funding rental-only schemes.
For more on LaingBuisson’s Retirement Housing Conference click here.