LXi has invested 90% of issue proceeds – The Board of LXi REIT has announced that the company has completed the acquisition of the freehold interest in a portfolio of regulated long-let supported living properties located in Surrey, Somerset and Leicestershire. The purchase price is GBP5.0 million, reflecting a net initial yield of 6.0% (net of acquisition costs).
Each property is immediately income producing and has been let on a new 25-year lease, with no tenant break, to a specialist Registered Provider of social housing. The Registered Provider is regulated by the Homes and Communities Agency and receives its funding for the rent payments directly from the relevant local authority.
Each lease is subject to annual upward-only rent reviews index-linked to the Consumer Price Index (uncapped) and the Registered Provider is responsible for the costs of repair, maintenance, insurance and outgoings.
The properties in the Portfolio comprise specialist, high quality supported living homes for individuals with physical and/or mental disabilities or other care needs.
The acquisition has been funded from equity resources, with senior debt finance to be introduced in the near term.
John White, Partner of LXi REIT Advisors Limited, commented: “The Company has now deployed just under 90% of its net equity at an attractive average net initial yield of 5.9%, diversified across seven property sub-sectors and with 14 strong tenants. The assets have a long weighted average unexpired lease term to first break of 23 years and over 95% inflation-linked rent reviews. We are in solicitors’ hands on further acquisitions across a range of property sectors which will fully absorb in short order both the balance of the Company’s equity and the debt finance under the recently completed Scottish Widows loan.”
LXI : LXi has invested 90% of issue proceeds