Residential landlord Grainger has proposed a placing of approximately 67.38m shares, representing approximately 9.99 per cent of the company’s issued share capital.
The company said the proposed placing was expected to raise £216m, including additional debt of approximately £144m based on Grainger’s LTV target range.
Proceeds will be used to fund two recent acquisitions, Becketwell in Derby and The Forge in Newcastle, totaling £95m.
The company will also acquire at least two schemes within its planning and legals pipeline which are being actively pursued and which are under offer and nearing exchange.
The schemes are in London and the South East of England comprising 580 homes and representing a total investment value of £202m and a blended average gross yield on cost of c.5.5 per cent.
There are also four schemes in regional cities comprising 925 homes and representing a total investment value of £226m and a targeted gross yield on cost range of six to seven per cent.
Future net rental income will be enhanced by £18m thanks to this placing when delivered, Grainger said.
“The placing further cements Grainger’s first mover advantage as the largest private rented sector (PRS) homes provider. It will be earnings enhancing as the developments progress, will support our growth strategy and assist in our mission to build more quality rental homes throughout the UK,” Helen Gordon, Grainger chief executive, said.