LXi REIT buys supported living portfolio – 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 Yorkshire. 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 purchase price for the portfolio is GBP4.5 million, reflecting a net initial yield of 6.0% (net of acquisition costs to the company).
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 Prices Index (uncapped) and the Registered Provider is responsible for the costs of repair, maintenance, insurance and outgoings.
About LXi REIT
The fund invests in UK commercial property assets let, or pre-let, on very long (typically 20 to 30 years to expiry or first break), inflation-linked leases to a wide range of strong tenant covenants across a diverse range of property sectors.
It may invest in fixed-price forward funded developments, provided they are pre-let to an acceptable tenant and full planning permission is in place but it will not undertake any direct development activity nor assume direct development risk.
LXi is targeting a minimum annual dividend of 5 pence per ordinary share, starting from the financial period commencing 1 April 2018, with the potential to grow the dividend in absolute terms through upward-only inflation-protected long-term lease agreements, and is targeting a net total shareholder return of 8 per cent. plus per annum over the medium term.
The company, a real estate investment trust (REIT) incorporated in England and Wales, is listed on the premium listing segment of the Official List of the UK Listing Authority and was admitted to trading on the main market for listed securities of the London Stock Exchange in February 2017.
LXI : LXi REIT buys supported living portfolio