Toronto-based Starlight Investments has closed a U.K. fund focused on build-to-rent (BTR) development following a successful $1.27-billion (£680 million) fundraise.

The global real estate investment and asset management firm said the fund will support the acquisition and delivery of over 6,000 BTR homes across the U.K.

The closing of Starlight UK BTR Fund II "represents a significant milestone in the continued expansion of Starlight's U.K. platform and reflects investor confidence in the company's BTR strategy, operational excellence, and disciplined execution," the company said in an announcement this morning.

"Fund II attracted strong participation from a diverse group of global institutional investors from across Europe, APAC, and Canada, including both existing limited partners and several new investors."

Capital partially deployed to 3 major projects

The fund will cover three significant rental communities currently under development, Starlight said. 

Two major projects are underway in Manchester. The 60-storey Trinity Heights project is nearing completion and will offer 532 suites, an indoor pool, co-working areas, a gym, resident lounges and an outdoor terrace on the bank of the River Irwell. 

A second BTR community is at an earlier stage of development in the city's Greengate neighbourhood.

In Basildon, Starlight is building a 492-suite, three-block, midrise property called The Mercantile.

"With Fund II now closed, our focus is on execution and the next phase of growth for our U.K. residential platform," Jonnie Milich, head of U.K. residential, Starlight Investments, said.

"We have built a significant pipeline, an experienced local team and a growing portfolio of communities moving through construction, lease-up and operations. As we continue to advance our pipeline and bring new communities online, our portfolio will place us among the U.K.'s top four BTR operators by scale."

Entry into U.K. market

Starlight entered the U.K. BTR market in 2023, joining a group of global institutional partners on the creation of three initial BTR communities - in Manchester, Liverpool and Ashford - and setting a target to acquire $1 billion of assets.

It now has 12 BTR communities spanning development through to active leasing and operations. "(The) platform is focused on delivering professionally managed rental housing in markets supported by strong rental demand and economic fundamentals," the press release said.

"The successful close of Fund II reflects the strong institutional conviction behind Starlight's U.K. residential strategy and the opportunity we continue to see in the market," Starlight global markets president Raj Mehta said.

"We are grateful for the continued support of our existing partners and pleased to welcome new investors to the platform. With the capital committed, we are well positioned to continue delivering homes in chronically undersupplied markets across the U.K."

About Starlight Investments

Starlight Investments is a privately held owner, developer and asset manager of over 70,000 multi-residential suites and over 7 million square feet of commercial property space with $30 billion in AUM. Starlight offers a range of investment vehicles across various real estate strategies.

It was established in 2011 as an institutional real estate asset and investment manager focused on Canadian multi-residential residences.

EDITOR'S NOTE: RENX has requested additional comment from Starlight and this article will be updated if more information becomes available.