The Britannia Music Site development will see 206 private rental homes built on Chapel Road in Ilford.
Durkan will be the developer and contractor for the scheme, which is anticipated to be ready for occupation by April 2020.
This latest deal marks the fourth investor-housebuilder agreement by M&G Real Estate and follows the investor's second deal with Telford Homes to finance and build 125 new private rental homes in Upton Park, also in East London.
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Alex Greaves, Head of Residential Investment at M&G Real Estate, said: "We very much welcome this initial deal with Durkan and look forward to working with them on other schemes.
"Following our partnerships and deals with Crest Nicholson, Telford Homes and Mulbury, this deal demonstrates our commitment to providing renters in the UK with the highest quality of homes in well-managed, sustainable communities.
"The build to rent sector offers long-term growth potential with considerable diversification benefits for investors – and our strategy ensures scale and efficiency, which in turn provides a major opportunity for institutional investors seeking access to the UK residential sector."
Danny Durkan, Executive Chairman of Durkan, added: "We are delighted to have closed our first transaction with M&G Real Estate and look forward to further deals with the fund. Durkan has excellent land acquisition, development and contracting capabilities which provide a strong platform for partnership transactions in the growing build to rent sector."
(LM/JP)
