Home REIT adds 314 more beds for homeless people – Home REIT has bought a further 14 separate portfolios of properties located across England for an aggregate purchase price of £47.1m (including acquisition costs). Following this deal, it has invested all of its IPO proceeds plus over 40% of its £120m 12-year debt facility, the remainder of which has been fully allocated to further identified properties. [Time to raise more money!].
The combined portfolio comprises 603 properties, which can accommodate over 3,330 people and represents a weighted average net initial acquisition yield of 5.8%.
The new deal adds a further 314 beds across 31 properties, providing much needed accommodation for vulnerable homeless people in London, North West, East, East and West Midlands, South East and South West regions of England. The properties are let at a low and sustainable rental level, on new, unbroken, long term, full repairing and insuring leases to seven different specialist registered homeless charities, providing them with long term security of tenure, which the investment adviser believes is crucial to rehabilitating vulnerable individuals and helping to break the cycle of homelessness seen in short term accommodation. The rents received under these leases are subject to annual upward-only rent reviews, index-linked to the Consumer Prices Index, subject to an annual collar and cap of 1%. and 4%., respectively.
Each of the Properties is immediately income producing and the blended net initial yield of the portfolio following the acquisition of the properties is ahead of expectations.
HOME : Home REIT adds 314 more beds for homeless people