Berkeley forms property tie-up with National Grid

7th Nov 2014 12:25

Upmarket house-builder Berkeley Group has teamed up with UK power network operator National Grid in a southern England-focused property venture.The pair say the new partnership, to be called St William Homes LLP, will create major housing and mixed-use developments across London and the South East.The joint-venture will bring together National Grid's "significant portfolio" of surplus brownfield land, which it wants to release for development, with Berkeley's development expertise.St William aims to start development activity on its first site in 2016, with the first homes ready in 2017.National Grid and Berkeley will each own half the equity in the JV and funding will be through a combination of shareholder equity and bank funding at a 50/50 equity-to-debt ratio.The equity investment for each shareholder will be initially capped at £175m. When combined with bank debt, this will result in the joint venture vehicle having available funding of up to £700m.Berkeley's managing director Rob Perrins said the move would help to ease the UK's chronic housing shortage."This is good news for house-building. St William will take these redundant sites and turn them into new communities."Berkeley shares fell 19p or 0.85% to 2226p at 13:26 in London. National Grid rose 1p to 918p.