LONDON: EcoWorld London, is actively pursuing new opportunities to tap the growing institutional demand for purpose-built build-for-rent (BtR) developments in the UK and targets to finalise another big deal before the year-end.
EcoWorld London is a 70 per cent unit of Bursa Malaysia-listed Eco World International Bhd (EWI).
EcoWorld London chief executive Cheong Heng Leong said BtR units see good take up among the working class as London continues to generate increasing number of jobs.
"Over the last 20 years, the number of jobs is expected to increase by 40 per cent in London while total home supply is up by only 15 per cent," said Cheong.
"In addition, some 60 per cent of Londoners are expected to rent their home in the next 10 years, following the steps and the real estate prices here are too expensive," he told reporters visiting EcoWorld London's headquarters here, today.
Also present were EWI executive vice chairman Tan Sri Liew Kee Sin, EWI chairman Tan Sri Azlan Mohd Zainol, EWI president and chief executive officer Datuk Teow Leong Seng and fellow directors Cheah Tek Kuang, Datuk Siow Kim Lun and Pauline Wong Wan Voon.
EWI’s three biggest shareholders are Eco World Development Group Bhd, GLL EWI (HK) Ltd and Tan Sri Liew Kee Sin.
EcoWorld London's earliest BtR project was launched in 2013 and Aberfeldy Village was one of the first purpose-built BtR projects in London.
Last year, EWI expanded its presence in the UK when it bought a 70 per cent stake in Be Living Holdings Ltd, the residential property development arm of Willmott Dixon Holdings Ltd.
Having rebranded Be Living as EcoWorld London, EWI is making a name in BtR schemes across 12 sites in London with an estimated gross development value of £2.6 billion.
The BtR schemes are usually located in the periphery of Central London as they are affordable and close to transport hubs. Many middle class people live in BtR schemes and commute into Central London.
Todate, EcoWorld London's portfolio has more than 3,600 BtR units. It aims to grow it to 10,000 units in five years.
In December 2018, American fund Invesco Real Estate bought more than 1,000 BtR homes in Kew Bridge and Barking from EcoWorld London for £389 million.
Once the project is fully completed in 2020, EcoWorld London will lease and manage rental homes as well as collect recurring rentals on behalf of investors like Invesco, under long-term contracts.
For the past year, London residential prices have been declining as Brexit uncertainties continues to overshadow the capital’s moribund property market.
Brexit is an abbreviation for "British exit," referring to the UK's decision in the 2016 referendum to leave the European Union. The UK's newly-elected Prime Minister Boris Johnson has pledged to deliver on his Brexit commitment by October 31, 2019.
EcoWorld London's chief operating officer Matthew Pullen admitted the open market sales in the UK is somewhat dampened by the uncertainties of Brexit but highlighted that was not the case for BtR as this business model targeted locals looking to rent.
"There is no denying that there is a shortage of quality homes in the city of London, particularly rented houses based on demographics or population structure," Pullen said.
"The BtR business model enables us to accelerate the scale of growth quickly and execute multiple projects simultaneously, thus providing a much needed number of residential units in London," Pullen added.