SCOTTISH property group Lomond Capital has kicked off another round of acquisitions after buying an estate agency in Birmingham which will take its portfolio in the city to more than £250 million.
The Edinburgh-based company has acquired John Shepherd Estate Agents, which will now be merged with Marwood Homes and John Shepherd Lettings, which are already owned by Lomond in the city.
As well as managing a portfolio of properties for private landlords, the enlarged Birmingham business will sell more than £200 million of property each year.
Lomond is now looking to acquire other “bolt-on” acquisitions across both lettings and estate agents in the city and is also in negotiations with businesses in other cities in England and Wales.
The founder of the Birmingham business, John Shepherd, will retain a significant shareholding and join the board of the business he founded in 1991.
Stuart Pender, chief executive of Lomond Capital, said: “This is the first in a number of larger acquisitions planned in the south of England. The merger of John Shepherd Estate Agents with our existing businesses allows us to create a full service proposition for our clients under the leading estate agents brand in the region.”
The announcement co-incides with the appointment of a new chief financial officer and partner for Lomond, Hazel McIntyre.
She will join Lomond at the start of April having spent periods of her career with RBS, Green Highland Renewables and Giles Insurance.
Pender said: “Hazel has significant experience in both seeing through acquisitions and managing growth in a rapidly expanding group, with profit increasing in Giles Insurance from £8m to £24m during her five-year period as mergers and acquisitions director.”
In 2015, Lomond Capital appointed Ivor Dickinson, former chief executive of Douglas & Gordon in London, to develop the business in the south of England. Lomond is currently in negotiations with estate agencies and lettings businesses in Bristol, Brighton, Cardiff, Oxford and Reading.
Lomond Capital was started in 2010 and now manages residential properties worth in excess of £2.2 billion and sells more than £450m of property a year, employing more than 350 members of staff.
It currently has businesses in Aberdeen, Birmingham, Edinburgh and Manchester and is planning further investments across the south of England and Wales.
In 2014, Lomond Capital received an undisclosed private equity investment from MML Capital Partners to accelerate its expansion in the UK’s residential rental property market. MML took a minority share in Lomond under the deal.
Lomond’s strategy is to acquire and grow high-quality regional property asset management businesses in specific locations, then to provide additional services to help landlords maximise returns from their investment in the private rental sector.
Last year it added lettings business Grant & Wilson, which trades as Bruce & Partners in Aberdeen and Ellon, to its interests in Scotland.
The private rental sector market in the UK is growing rapidly as Britain moves towards a higher proportion of total housing stock being held in the sector.
Forecasts suggest almost a quarter of all UK households will be renting from private landlords by 2025.
The market remains highly fragmented with more than 15,000 agents currently operating and the sector is attracting growing interest from corporate investors.
Last week Legal & General (L&G) announced a deal with a Dutch pension fund manager to build 3,000 flats across the UK under a £600m “build-to-rent” plan.
L&G and PGGM will initially build 650 flats in Bristol, Salford and London. L&G will act as the developer and landlord and use income to fund pensions.