L&G retirement arm funds first US ground-up housing: 201 Concord units

L&G Asset Management's US business and Boston-based Taurus Investment Holdings broke ground on a 201-unit apartment development in Concord, Massachusetts, the first US housing construction project L&G's Institutional Retirement business has funded, Multifamily Dive reported Oct. 1. The capital behind it is retirement money rather than an opportunistic fund, aimed at a Greater Boston submarket the release calls structurally undersupplied, and construction is expected to begin this year, with the first of two buildings complete by the end of 2028 and the second wrapping up in 2029. No price was disclosed.

A spokesperson told Multifamily Dive that the retirement arm is investing in income-producing US multifamily in markets where underlying demand is durable, new supply is hard to build, and housing is not affordable, and that Concord is a high-quality market where new supply is difficult to create and demand is high. The duration fit is clear, since retirement liabilities do not need cash in 2026 and these buildings will not have a rent roll until 2028 at the earliest; the release does not say how the pension pool weighs construction risk.

Both buildings will be all-electric and use geothermal heating and cooling, with onsite solar expected to generate about 134,000 kilowatt-hours of electricity a year and Taurus working with EcoSmart Solution on energy analysis, system design and ongoing energy management. The project is targeting Phius CORE 2024, a passive-building performance standard, and a quarter of the 201 units will be affordable under state guidelines, a mechanism the release does not describe. Through a spokesperson, L&G frames the energy work as lower consumption, lower costs for owner and tenants, and a possible lift to long-term value for residents, investors and the community; the firm says it has applied that approach across its multifamily portfolio and is building Concord to it from the outset.

Concord is the arm's first US construction project, not its first US apartment exposure. Its other recent multifamily investments include The Alder in the Denver area and Arkadia West Loop in downtown Chicago, both named in the coverage without terms. In September this publication reported the retirement arm's first US development check as a wager on the supply gap that opens in 2028 and 2029 rather than on the lease-up in front of it; the Concord detail shows what that bet looks like — two buildings, a state affordable requirement, a passive-house target, and delivery weighted to the back half of the decade.

Taurus sits in a different chair here than it did a few weeks ago. The Boston firm originated the Concord development and will oversee work through construction and delivery, with Callahan of Bridgewater, Massachusetts, as general contractor — the developer's seat rather than the buyer's. In September it closed on eight fully leased shallow-bay buildings two miles from Laredo's World Trade Bridge, a rent story underwritten by 15,000 to 18,000 trucks a day. The Concord release names both firms as developers and does not disclose how equity or fees are divided, so the split between the retirement capital and the operating partner is not public.

The two halves of the bid are buying different things. Prices on stabilized multifamily are resetting on rent and basis, and below-basis trades are the new comps, but that logic needs a rent roll to work from; a ground-up project has none, and no basis comp either. Its return is whatever spread the developer earns over construction cost once the buildings open, which puts the case on demand and on how hard it is to add supply in a place people already want to live. Retirement money taking construction risk is one answer to a market with few cheap entries, and it puts 201 units into the metro's 2029 supply that were underwritten on a retirement timeline.

Three numbers would settle what the release leaves open: the price, the equity split between the pension arm and its operating partner, and an all-in cost per unit that could be weighed against the trades clearing around it. The release fixes two dates — the first building by the end of 2028, the second in 2029 — by which point Concord and everything else that breaks ground in the metro will be leasing into the same market.