British builder Vistry Group has entered into a partnership agreement with Leaf Living and Sage Homes for the delivery of 2,915 private rental and affordable rental homes.

The partnership is expected to contribute to the country’s severe housing shortage and is said to be one of the largest new residential investment transactions on record. 

The gross development value of the deal amounts to approximately £819m ($1.03bn). 

The agreement encompasses 1,522 units for the private leased sector being provided to Leaf and 1,393 affordable houses for rent and shared ownership delivered to Sage.

The housing units will be built on plots across 70 of Vistry’s residential areas, with deliveries beginning this year and most residences to be completed within the following two years.

Vistry and Sage propose to use the existing Homes England grant funds from the Affordable Homes Programme to facilitate the development of an initial tranche of rental and shared ownership affordable houses.

Vistry Group CEO Greg Fitzgerald said: “We have an excellent track record of working in partnership with Leaf and Sage to deliver new homes and I am extremely pleased to have reached agreement to grow these relationships through this exciting, market-leading opportunity.

“Through our unique Partnerships model, Vistry is maintaining the momentum of delivery of much-needed affordable housing across the UK.

“Our strategy gives the group significantly greater visibility on earnings than traditional housebuilders and this new partnership and others to follow, will help us drive towards our medium-term targets and the delivery of £1bn of shareholder distributions over the next three years.”