Civitas Social Housing has acquired a portfolio of properties for £19.6m, bringing its run-rate dividend cover to 100%.
The group has completed the purchase of five freehold properties comprising 63 tenancies for £17.8m and exchanged contracts on three further properties comprising 11 tenancies for £1.8m.
The properties are located in Hertfordshire, Shropshire and Tyne and Wear, over five local authority areas, and are leased to Registered Providers (RPs) Inclusion Housing, Auckland Home Solutions C.I.C and Harbour Light Assisted Living.
All the properties are either purpose built or have been adapted for use as accommodation for tenants with life-long learning disabilities and other care needs who are expected to remain in occupation for the long-term and who receive 100% state funding. The properties are subject to long-term leases with rents adjusted annually in line with CPI over the full-term and are subject to a lower limit of inflation of 0% per annum and a maximum indexation of 4% per annum.
Civitas has financed the acquisitions with existing debt facilities and following the deals, the company’s gross LTV is approximately 28%.
Following the transactions, Civitas dividend is 100% covered as measured on an EPRA earnings run-rate basis.
As well as the acquisitions, the company announced it was widening its investment policy to include the NHS.
This would, in due course, enable Civitas to enter into long-term leases with the NHS, which may be structured in the form of specific joint venture arrangements and also with registered charities operating within areas of investment interest to the company.
Civitas said it would in due course convene an EGM with the purpose of seeking shareholder approval to amend the company’s investment policy, subject to regulatory approvals, for this expansion of investment counterparties.
Covid-19 update
Civitas said its housing association and care provider partners were making appropriate adjustments to working practices to ensure a direct continuity of service whilst seeking to build in contingency wherever possible. It said this was helped in some cases by the typically higher levels of staffing that is available within these active care environments.
CSH : Civitas Social Housing acquires £20m portfolio