Many larger lettings agents have been buying up the portfolios of smaller localised rivals in recent months as the private rental sector has become tougher, and the latest to report such a move is Belvoir.
Four of its franchisee have now completed portfolio acquisitions with collective revenues of £2 million a year, adding 1,335 properties to its property management tally in Hitchin/Welwyn Garden City/St Albans, Derby West, Hendon and Corby.
But the largest of the portfolio purchases has been completed by its Hitchin/Welwyn Garden City franchisee.
The deal includes 624 managed rental properties in Welwyn Garden City and St Albans with a total revenue of £1 million a year, adding fees revenues to Belvoir’s head office of £400,00 over the next six years.
This deal was funded by the local Belvoir franchisees own sources of finance, and is both a portfolio and territorial expansion for it, helping the franchisee break into the lucrative St Albans rental market.
The other three portfolio acquisitions add another £1 million a year the franchisees revenues, helped by a £193,000 cash injection by the Belvoir head office.
Belvoir UK’s keenness to help franchisees hoover up portfolios with its ‘Assisted Acquisitions’ programme is clear from the financials.; it expects to make an extra £192,000 in fees revenue a year from these deals, and in January the company predicted ‘consolidation’ like this would be a key trend in 2018.
“In the recent trading update, we reported that we had doubled the number of transactions under our Assisted Acquisitions programme in 2017 and promised that there was a strong pipeline expected to complete in the first quarter of 2018.
“We have already delivered on that promise within just two months with these four transactions equating to 75% of the total value of 2017 franchisee acquisition transactions, adding around 1,335 managed properties to the Belvoir network.”