The Canada Pension Plan Investment Board (CPP Investments) has teamed up with Kennedy Wilson, a global real estate investment company, to establish a joint venture (JV) in the UK single-family rental housing sector. This ambitious venture aims to build a portfolio valued at approximately £1 billion, with CPP Investments contributing £500 million and Kennedy Wilson investing £56 million. CPP Investments will hold a 90% stake in the JV, while Kennedy Wilson will hold 10%.
The JV is focused on delivering energy-efficient, new-build homes in rapidly growing communities that feature excellent connectivity, quality local amenities, and strong employment and educational opportunities. To fuel the portfolio’s growth, the partnership will collaborate with housebuilders across the UK. Initial properties include units from two developments already secured by Kennedy Wilson: Barratt Redrow’s site in Norwich, where the first phase of homes is already being leased, and Miller Homes’ project in Stevenage, with homes set for completion by Q2 2025. With a pipeline of projects valued at over £360 million and a potential of 4,000 units once fully deployed, Kennedy Wilson is well-positioned to drive the JV’s expansion.
Tom Jackson, Head of Real Estate Europe at CPP Investments, commented:
“Private capital can be instrumental in addressing the lack of high-quality rental housing in the UK. This investment aligns with our broader real estate strategy of pursuing scalable opportunities in high-quality assets with stable cash flows. Through this JV with Kennedy Wilson, we are creating a pathway to strong returns for CPP’s 22 million contributors and beneficiaries.”
Kennedy Wilson will manage the JV and receive standard management fees, drawing on its expertise in professionally operated rental housing, with a portfolio of over 60,000 units across the US, UK, and Ireland. The company’s established residential platform features a vertically integrated team for investment, asset management, development, and operations.
Mike Pegler, President of Kennedy Wilson Europe, added:
“Our partnership with CPP Investments represents a significant step in delivering essential rental homes for UK families. The structural challenges in the UK rental housing sector present a compelling investment opportunity, allowing us to grow our portfolio at scale and generate steady, risk-adjusted returns in this critical sector.”
This JV not only targets a substantial growth in professionally managed rental housing but also brings forward the promise of a scalable, high-quality rental portfolio to meet growing demand across the UK.
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