Springfield enters private rented market with new Sigma partnership
Springfield Properties is to deliver its first homes for Scotland’s private rented sector (PRS) and is targeting the release of hundreds of homes over the coming years.
The housebuilder has signed a collaboration agreement with urban regeneration specialist Sigma to kick-start the process.
Under the terms of the agreement, Springfield and Sigma will collaborate to acquire and develop sites in Scotland for the private rental sector.
A number of Springfield sites, primarily the group’s ‘village’ developments in Dundee, Edinburgh, Perth and Stirling as well as its development in Inverness, have been identified as potential sites for PRS development.
Subject to meeting certain criteria, Sigma will purchase part of these sites from Springfield and will award Springfield a fixed-cost design and build contract to deliver housing on the acquired land.
Following handover of the completed homes by Springfield to Sigma, the homes will be let and managed by Sigma under its ‘Simple Life’ brand. In addition, Springfield and Sigma will seek to identify other sites for Sigma to acquire for the purpose of PRS housing development by Springfield.
Earlier this year, Sigma launched the Sigma Scottish PRS Fund, with initial resources of £43 million, including £30m investment from the Scottish Government’s Building Scotland Fund in the form of a revolving credit facility. This is the first dedicated vehicle to focus on the creation of new rental homes for families in the private rented sector in Scotland.
Innes Smith, chief executive officer of Springfield Properties plc, said: “We are proud to be chosen by Sigma as their first partner in Scotland to deliver homes for the private rented sector. Like Springfield, Sigma focuses on providing the high-quality family homes that are the heart of successful communities.
“This agreement stands to accelerate our delivery of homes, particularly on village developments, and we expect it to provide a further revenue stream, alongside our existing private and affordable housing activity, with good visibility over cash flows. It will also increase the number of homes available in the private rented sector and contribute towards our goal of ensuring that everyone within Scotland has a great place to live.”
Graham Barnet, chief executive officer of Sigma, added: “We are delighted to announce this major partnership with Springfield, one of Scotland’s leading housebuilders. It targets the construction of hundreds of new homes for families across Dundee, Edinburgh, Inverness, Perth and Stirling, which include the key locations of Springfield’s Village sites. Once built, our homes will be let under Sigma’s ‘Simple Life’ lettings brand.
“Springfield has a well-established reputation for delivering quality homes in Scotland and this partnership brings significant benefits for both sides, especially in accelerating the rate at which mixed tenure sites can be developed. We look forward to working with Springfield as we develop the partnership and extend our model in Scotland.”