The DTZ Investors Co-Living Fund (COLIV) has entered into a £32m development facility, representing 65% Finance to Cost, to construct a 222-unit co-living development in Harrow. Finance has been structured on a Shari’ah compliant basis and is provided 50/50 by Bank of London and The Middle East (‘BLME’) and Bank ABC in London. CBRE’s Debt & Structured Finance team, part of CBRE Capital Advisors, acted as sole debt advisor to DTZ Investors.

Launched in October 2019, COLIV is the first dedicated co-living fund in the UK, launched in partnership with the world’s leading co-living developer and operator, The Collective. The development in Harrow was the seed asset in a planned portfolio of best-in-class, large-scale co-living assets with a target gross asset value of £1 billion. COLIV is also onsite constructing a 310-unit co-living scheme in Earlsfield.

Upon completion in Q4 2021, the 87,000 sq ft development will be operated by The Collective, and will benefit from 27,000 sq ft of communal amenity space, including a gym, cinema room, library, communal kitchen, laundry room, games room, roof terrace, a restaurant and co-working space.

Chris Cooper, CEO of DTZ Investors commented: ‘We are delighted to be working with BLME and Bank ABC on the recapitalisation of COLIV’s development project in Harrow. This commitment from both banks is another demonstration of the strong investor appetite to access the rapidly evolving co-living sector. Construction is progressing well onsite, having just topped-out the 8 storey frame, meaning we are now less than 12 months from opening the doors. Plans are well afoot for delivering an affordable housing solution that will focus on building inclusive communities that focus on the health and wellbeing of our members”.

Paul De Croos, Head of Real Estate Finance at BLME, commented: ‘We are pleased to be working with DTZ Investors and Bank ABC to see this exciting project to completion. Co-Living represents an important new phase of development in the real estate market. For BLME, this is a unique opportunity to support a forward-looking, high quality community accommodation project that is focused on creating solutions to the challenges faced by a generation of younger renters.’

Keith Leach, Head of UK Real Estate Finance at Bank ABC, commented: “Bank ABC is excited to join BLME in working alongside DTZ Investors to deliver the COLIV Fund’s first development project. The Co-Living sector is a developing market, offering modern cost effective accommodation with a range of amenities to suit the lifestyles of young renters. For the Bank, this is a great opportunity to work with DTZ investors, who are highly experienced real estate investors and The Collective who are experienced operators at the forefront of this growing sector.”

Paul Coates, Head of Debt & Structured Finance UK & EMEA, CBRE commented: “The need for attractive and community-led accommodation has been a growing trend for younger generations moving to urban locations. Financiers are increasingly recognising the growing opportunities in the sector as a result of these structural changes and are demonstrating competition to finance best-in-class assets. We are delighted to close the development facility for COLIV and would like to congratulate all involved, including BLME and Bank ABC for getting this forward funding development facility across the line.”

In 2019, CBRE advised on over €6bn of debt transactions across EMEA. This represents the team’s first financing of a co-living asset pipeline at a time when the sector is developing significant interest from investors, operators and occupiers.

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DTZ Investors

Kate Fearnley

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