Growing interest in the build to rent sector was highlighted by two contract wins for housebuilder Bovis Homes (BVS) to build 510 homes for two separate investors, one of which is accessing funds from the government's Build to Rent scheme.
The two deals are worth £80m, with around half the homes expected to complete this year and the remainder in 2015. Crucially, the houses are to be built on existing development sites, which means a more effective use of capital employed.
And assuming that the current favourable conditions continue, Bovis expects to increase total output from 2,813 homes last year to between 3,650 and 3,850 in the current year. Close attention is also being paid to effective use of capital resources, and Bovis now expects the return on capital employed to rise from 10.4 per cent last year to around 15 per cent.
