The scheme is part of developer Bouygues' regeneration of Barking town centre and the 100 flats will be built above a relocated Asda supermarket.
Under the terms of the deal, Grainger will let the residential units and take responsibility for the asset and property management. The deal follows a previous announcement by Bouygues and Grainger to work together in order to attract institutional investment into the build-to-rent sector.
Grainger said in its interim management statement that the investment will add to its market rental income and is an "important strategic step" towards Grainger leading the emergence of a viable build-to-rent market in the UK.
“The residential element of this scheme is a significant milestone for the private rented sector, putting into practice a new model for the creation of purpose built high quality and professionally managed rental accommodation," said Grainger's executive director for property, Nick Jopling, in a statement.
"This is a sector that desperately needs to grow in order to meet the demands of the UK population and is supported at the highest levels of Government, and we believe that this style of residential development has huge potential to grow in the coming years,” Jopling said.
Bouygues said it expects the residential part of its regeneration scheme to be completed in 2015.
