Real assets investment manager PATRIZIA and London-based developer Fabrix have unveiled a new joint venture, Sustainable Communities London (SC London), committing more than £100 million to tackle the capital’s acute housing shortages.

With an initial £45 million of client capital managed by PATRIZIA, the venture will focus on transforming underused land and buildings into affordable, alternative and sustainable homes. The first scheme is already under way in Elephant & Castle, where a redundant 1980s office block on Walworth Road is being converted into a mixed-use, community-focused development.

The project will deliver 283 student beds, 23 on-site affordable homes at social rent, equivalent to 35% of the total residential provision, and community amenities including a 5,000 sq. ft. retail space, a 6,200 sq. ft. garden and a 2,600 sq. ft. community kitchen. The student accommodation is expected to free up as many as 113 family homes currently used as Houses in Multiple Occupation (HMOs).

The Walworth Road scheme, which received unanimous planning consent in November 2024, is intended as a model for how purpose-built student accommodation (PBSA) and co-living can help ease pressure on London’s wider housing stock. Elephant & Castle, already undergoing major regeneration, will see the development integrate sustainable design with social initiatives tailored to local needs. The community kitchen, co-designed with local groups, will bring residents together through the shared preparation of healthy food, aiming to reduce social isolation.

The affordable housing units will ultimately be sold to and operated by a Registered Provider, helping the London Borough of Southwark to address demand for high-quality social rent homes.

Marleen Bekkers, Fund Manager of PATRIZIA Sustainable Communities, said: “This latest expansion of our Sustainable Communities platform demonstrates how impact-driven investment can address London’s acute housing challenges while delivering long-term value. By partnering with Fabrix to repurpose underutilised land and assets like this one in Elephant & Castle, we can deliver high-quality homes while setting new standards for environmental and social impact in the capital.”

The joint venture builds on PATRIZIA’s Sustainable Communities strategy, which has already supported developments across Ireland, the UK, Belgium and Spain. Its focus is on long-term social and environmental value through real estate that delivers measurable impact.

London’s housing need is pressing: social housing waiting lists remain long, rents continue to climb beyond the reach of many, and there is a shortage of quality rental stock for young professionals. In addition, over 400,000 students are competing for fewer than 100,000 PBSA beds across the city.

Clive Nichol, CEO and Founder of Fabrix, commented: “Our collaboration with PATRIZIA allows us to scale our vision of reimagining urban areas to positively impact and serve society. Our development at 182-202 Walworth Road is a blueprint for how innovative, community-focused development of alternative housing sectors such as PBSA and Co-Living can help address London’s housing crisis while delivering significant social and environmental sustainability outcomes. Through Sustainable Communities, we look forward to unlocking the delivery of more much-needed affordable homes for London.”

The partnership between PATRIZIA and Fabrix brings together institutional investment expertise and an established track record in transformative urban projects. With the launch of SC London, the two firms aim to build a portfolio of residential assets that not only deliver housing but also create community value for the long term.