Telford Homes sells Caledonian Road development for £67m

Telford Homes' large Caledonian Road development in North London - The Pavilions - received a boost on Monday, with the news it had sold all houses in the scheme to a subsidiary of L&Q, one of the UK's biggest housing associations.

The AIM-traded residential property developer said the transaction involved all 156 homes within The Pavilions development, 96 of which were to form part of L&Q's private rented sector (PRS) portfolio.

Under the terms of the planning permission, the other 60 homes were sold to L&Q for affordable housing.

The contracted price for the entire development was £66.75m, with regular payments to be made by L&Q throughout the construction period. As a result, the development would not require any equity or debt to be invested by Telford Homes.

"We are delighted to have concluded our first PRS deal with a well-established provider, who are already a valued partner to the group," said Telford Homes chief executive John Di-Stefano.

"The strong level of interest in The Pavilions by PRS investors confirms the potential of the PRS market anticipated at the time of our equity placing in November 2015," he added.

Di-Stefano said Telford was continuing to benefit from an imbalance between demand and supply of homes in non-prime London, and the transaction marked the start of what he saw as a new aspect to the group's sales mix.

Construction on The Pavilions was already underway, and was expected to be complete by the middle of 2016.