_Knight Frank advises on successful disposal of Bow Square, Southampton’s largest BTR scheme

In addition to apartments, the building also boasts extensive onsite amenities, including a residents' lounge, fully-equipped gym, yoga studio, meeting room and courtyard garden, and 6,000 sq ft of flexible commercial space. The freehold interest of this prime BTR asset has been acquired by CompassRock International from global real asset investor PATRIZIA.

Bow Square is fully operational at close to 100% occupancy, having been completed in three phases between 2017 and 2018. The scheme is exceptionally-well located in the heart of Southampton, close to the West Quay shopping centre and the Ocean Village marina.

Lloyd Wraith, Partner, Knight Frank Residential Investment, says: “Bow Square is an impressive purpose-built, institutional-grade BTR asset; to see a stabilised asset of this quality and scale come to market is rare, and we're delighted to have advised PATRIZIA on the disposal. Despite significant macroeconomic headwinds and severe fiscal tightening, competition between global investors was fierce – highlighting BTR’s enduring appeal.”

Antonio Marin-Bataller, Managing Director, Pan-European Residential Transactions at PATRIZIA, says: “As an early mover into UK BTR with our acquisition of the Bow Square site in 2015, our strategic disposal of the asset completes a successful full investment cycle, delivering strong returns for investors and crystallising the performance for one of our flagship value-add funds. Having invested in the asset from development through to disposal, we look forward to capitalising on similar opportunities in the UK living sector and leveraging our expertise in creating significant value for clients.”

David Woodward, on behalf of CompassRock International, says: “We're very happy to have secured one of the first ‘value add’ BTR investments in the UK. We'll be leveraging deep experience in this sector from the US (as well as our asset and property management experience in the UK) to make improvements to this asset and bring a very high level of customer service to our residents.”

Southampton is an affluent but supply-constrained market. According to our Knight Frank research, there are almost 20,000 PRS households living within Southampton city centre alone, yet only 411 operational BTR apartments – making BTR penetration within the city less than 2%. With Bow Square representing almost 69% of all BTR in Southampton, occupancy levels since launch have been consistently high, making it a highly attractive asset for investors.

Contact our Residential Investment team to see how we can help you.