Grainger plc (LON: GRI) shares rose over 2% on Wednesday after the private rental provider reported a 15% increase in total net rental income in the four months to the end of January 2025, driven by strong demand in the build-to-rent (BTR) sector.
The company, which operates a £3.4 billion portfolio of around 11,100 homes, said total like-for-like rental growth stood at 4.7% year-to-date, while occupancy in its stabilised PRS portfolio remained high at 96%.
Chief Executive Helen Gordon noted that “Grainger continues to perform strongly,” highlighting the company’s transition into a real estate investment trust (REIT) later this year as a key milestone in its transformation.
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“Our leading operating platform enables us to keep central costs relatively flat while we grow materially, driving significant compounding earnings growth over the coming years,” Gordon said.
The company expects earnings to increase by 50% in the medium term as it delivers on its £1.4 billion investment pipeline.
Grainger also reported strong sales performance, with proceeds from regulated tenancy sales helping fund BTR investments. The company achieved sales prices 0.5% above valuations and noted strong liquidity in the residential sales market.
Looking ahead, Grainger sees continued tailwinds for the UK rental sector, with demand outpacing supply.
“The fundamentals of the UK residential rental market remain exceptionally supportive,” the company stated, citing government backing for BTR and regulatory challenges for private landlords as key drivers of growth.
“Demand continues to grow and rental supply continues to be constrained as small, private landlords face increasing headwinds,” the company added.
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