PROPERTY giant Grainger is forming a joint venture to manage its new acquisition Sovereign Reversions.
Britain’s biggest residential landlord, which is based in Newcastle, is selling a 50% stake in the equity release business to MREF II Equity Release, a subsidiary of the Moorfield Real Estate Fund II.
Sovereign Reversions’ property portfolio is valued at around £69m and MREF will pay £17.5m for its stake in the business, which Grainger bought in June.
The assets will be managed by Grainger and the company will also receive an annual management fee for its work. The two companies will have equal control of the joint venture’s board.
Grainger chief executive, Andrew Cunningham, said: “The creation of this joint venture with Moorfield is consistent with our long-established strategy of co-investing alongside partners across a range of residential sectors and of utilising third party capital to develop and grow our business.”
Grainger said both it and Moorfield were “firmly committed” to the equity release sector - buying elderly people’s homes so they can live there rent free for the rest of their lives - and would look at buying further assets.
Moorfield chief executive, Marc Gilbard, said: “We look forward to working alongside Grainger, sharing the inherent value of the acquired portfolio and business, as well as exploring future opportunities for portfolio acquisitions.”