SINGAPORE - Property group City Developments Limited (CDL) has expanded into the UK private rented sector (PRS) with its £15.4 million ($27.5 million) acquisition of a freehold site in Leeds, from Alpha Real Trust.

This translates to about £80, or $142 per square foot for the 193,752 square feet (sq ft) site.

Full planning permission has been obtained for the site, which has a residential net lettable area (NLA) of 386,000 sq ft, and a commercial NLA of about 16,000 sq ft, CDL said.

The group plans to develop a 664-unit build-to-rent residential project with retail space located within the site's heritage arches beneath a viaduct. According to CDL, the project is expected to be completed in 2023, with total development cost estimated at £140 million, and net yield expected at 5 per cent annually.

Located at Monk Bridge in Leeds, the site is about a 10-minute walk to the Leeds train station, and two kilometres to the Leeds city centre. Leeds is the UK's third largest city, and about two hours from London by train.

In its press statement on Friday (March 1), CDL also noted that it will create a "vibrant and stylish" estate similar to New York's High Line landmark.

"A public park will be developed on the viaduct, providing spaces for public functions, outdoor film screenings, pop-up restaurants and a pedestrian walkway leading to the Leeds train station and Leeds city centre," the group said.

Added CDL group CEO, Sherman Kwek: "Expanding into the UK PRS is in line with our strategy to grow CDL's recurring income. Due to increased labour mobility and the growing popularity of renting, we see strong growth potential for this sector.

"Moreover, the PRS is a key part of the government's agenda to solve the UK's housing supply-demand imbalance. Brexit is expected to have limited impact on this sector as demand is mainly driven by locals."

As at 2.52pm on Friday, CDL shares were trading at $8.78 apiece, down 1.57 per cent, or $0.14.