By FARA AISYAH 

Eco World International Bhd’s 70%-owned subsidiary, Eco World London Holdings Ltd (EcoWorld London), has signed contracts worth £389 million (RM2.1 billion) with Invesco Real Estate for over 1,000 build-to-rent (BTR) homes in London.

In an exchange filing yesterday, the developer said the entire BTR component includes two sites at Kew Bridge in West London and Barking in East London.

Both locations have strong transport links to Central London, which has been identified as having an undersupply of rented homes and the ability to outperform the wider London market.

EcoWorld London CEO Heng Leong Cheong (picture) said the company is determined to do its part to correct the mismatch between the homes Londoners need, and those available in the market, in particular homes catered specifically for the rental demographic.

“At present, each of the leading BTR companies in London has less than 5,000 homes under management. Through EcoWorld London, our ambition is to secure a pipeline of over 10,000 homes in the next five years to become a BTR market leader.

“We will do this through the launch of a new operating company focusing solely on rented homes, which will be led by our highly experienced EcoWorld London team,” he said in a statement yesterday.

He added that the company remains confident in the long-term prospects of the UK property market, reinforced by this deal with Invesco.

As part of the agreement, EcoWorld London will let and manage the rental homes on behalf of the investor under a long-term contract.

The acquisition is being made on a forward funded basis, which will enable EcoWorld London to recover £66 million of its land cost shortly after exchange of contracts.

Additional payments tied to the completion of foundation works for each section, are expected to commence six months from exchange with the remaining construction costs financed by Invesco, on behalf of its client as works progress.

Construction work has commenced on both sites and the new homes will be available for rental from late 2020.

Eco World International added that the transaction comes less than six months from the date EcoWorld London completed its acquisition of 70% in the Willmott Dixon residential development business for £84 million, covering eight sites.