Nearly 1,000 homes are set to be built in Salford as part of a multimillion-pound private rented sector (PRS) investment unveiled by housing minister Gavin Barwell.

Developer Dandara Group will spearhead the scheme with support from the Homes and Communities Agency (HCA) and banking giant HSBC.

Unlocking £400 million of development, a total of 2,062 houses will be built across sites in Manchester, Leeds and Birmingham.

This comprises 995 homes at Chapel Wharf in Salford, 744 at Ingram Row in Leeds and 323 at Arena Central in Birmingham.

It is estimated that up to 1,500 construction jobs could be created across the three cities.

The project will receive £45m funding from the government’s new Home Building Fund, which makes money available to help kick-start new development and housebuilding.

“This is one of the largest private rental sector deals in the UK and will not only create thousands of homes for people in Birmingham, Leeds and Manchester – it will create jobs and opportunities for many hundreds of people,” said Barwell.

HCA chairman Sir Edward Lister said that the investment demonstrated a determination “to get builders building and substantially grow the market in this country”.

“We’re working on a number of other deals, with builders of all sizes, and we’re also using our investment and land to attract new entrants to the industry,” he added.

Dan Tynan, founder and chairman of the Dandara Group, said: “Dandara has already built more than 2,500 properties of this type in the last ten years in the UK, including Scotland’s largest PRS scheme of almost 300 properties in Aberdeen, acquired by LaSalle Investment Management on behalf of a large pension fund.”

HSBC’s head of housing in the UK Hugh Taylor said: “We are really pleased to be supporting Dandara alongside the HCA with development finance on this multi-site rollout of ‎their PRS programme. It is a significant contribution to the ‘housing challenge’ and is further evidence of PRS beginning to emerge as a distinct asset class.”