Property giant unveils new Build-to-Rent arm as it seeks to boost revenue

Berkeley Group is setting up its own build-to-rent (BTR) platform to build and manage 4,000 homes over the next decade, as it expects sales to remain “subdued” in the short-term.

The housebuilder announced the plan to operate and manage a large portfolio of rental properties yesterday in its results for the year to 30 April.

Berkeley plans to develop and rent out 4,000 homes in London. The 10-year project aims to take advantage of the strong rental demand in the London area.

As of 30 April, Berkeley’s land holdings comprised 54,081 plots across 70 developments.

The group’s board announced a further 33p per share ordinary dividend to be paid to eligible shareholders in July, and a 174p per share dividend to be paid in September.

Anthony Codling, managing director of equity research at RBC Capital Markets, said: “Berkeley’s FY24 results were slightly ahead of expectations, once again demonstrating the robustness and resilience of the Group’s business model.

“Not content with firing on all cylinders, Berkeley announced that it is adding another cylinder to its finely tuned engine, a Build to Rent platform, it has also increased its FY2025 guidance by 5 per cent to £525million – bold actions in uncertain times.

“The Build to Rent platform is not a response pointing a weakness in the sales market, rather it points to the significant potential in the private rental market.

“Whether looking at homes for sale or homes for rent, we have a supply shortage and Berkeley is doing its bit to supply the homes we need. We expect the shares to react positively to the results today and the enhanced guidance for tomorrow.”