Home REIT has acquired 156 properties for £42.4m as it continues to grow its portfolio of homeless accommodation.
Following the latest tranche of investments, since inception in October 2020, the company has deployed a total of £700m at a weighted average net initial yield of 5.86%.
The Properties are located across England, providing an additional 603 beds for those in need, whilst bringing the portfolio total to 8,556 and further enhancing its geographic diversification. They are let on an average lease length of 25 years at low and sustainable rents, on new, unbroken, full repairing and insuring leases to seven different specialist registered homeless charities, which each meet the Company’s rigorous operational and financial criteria.
The leases are subject to annual upward-only rent reviews, index-linked to the Consumer Prices Index, with an annual collar and cap of 1% and 4% respectively.
Each of the Properties are immediately income producing and, following these transactions, the blended net initial yield of the Company’s portfolio is ahead of expectations.
Gareth Jones, partner at Alvarium Home REIT Advisors Limited, said: “Since inception we have developed a strong track record for deploying funds available to us efficiently and, more importantly, prudently, using our existing relationships to access suitable investment opportunities off market. This has enabled us to create a significant portfolio of tailored accommodation for homeless people in locations across England and Wales where it is most needed. As this unfortunate situation becomes more critical, we intend to continue to scale and grow the number of beds we can provide to support the alleviation of this pressing societal challenge.”
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