Listed developer Terrace Hill has sold part of its residential business for £75m in order to pay down debt.

The company has sold a portfolio of properties from Terrace Hill Residential, which is 49% owned by the company and 51% owned by the family trust of chairman Robert Adair.

The portfolio was bought by Akelius, the Swedish private housing company looking to build up a private rented sector portfolio in the UK.

The book value of the portfolio sold was £79m at September last year. The whole portfolio of 59 residential blocks being sold by Terrace Hill was valued at £185m at that point.

The company said that the proceeds would be used to pay down the debt secured against the portfolio, which was provided by HBOS, now part of Lloyds Banking Group.

Philip Leech, chief executive of Terrace Hill, said:  “The exchange of contracts for sale of this portfolio is an important step in our planned exit from the residential sector.  We have interest in the balance of the residential assets owned both directly by us and through our associate Terrace Hill Residential.”