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- Alvarium to float £250m REIT aimed at “alleviating homelessness”
Alvarium Home REIT Advisors has announced its intention to launch an initial public offering (IPO) in Home REIT, a company focused on the alleviation of homelessness in the UK.
Home REIT will target inflation-protected income and capital returns, by investing in a diversified portfolio of assets across the UK which will be dedicated to providing accommodation to the homeless. It is targeting net total shareholder return of at least 7.5% per annum.
It said the accommodation assets will be let or pre-let on very long (typically 20 to 30 years), inflation-linked leases to registered charities, housing associations, community interest companies and other regulated organisations which have a proven operating track record in providing low-cost accommodation to the homeless and which receive housing benefit or comparable support from local or central government to fund the provision of such accommodation to the homeless.
Home REIT will target an issuance of £250m in the placing of 250 million ordinary shares at an issue price of 100p. The directors could increase the size of the issue to a maximum of 300 million ordinary shares.
The company will be making an application for its shares to be admitted to the premium segment of the official list of the Financial Conduct Authority and to trading on the premium segment of the main market of the London Stock Exchange. The company also intends to become a real estate investment trust.
Home REIT’s investment team, Alvarium Home REIT Advisers, has capitalised and transacted over £1.5bn of property assets with a particular focus on accessing secure, long-let and index-linked UK real estate through forward funding and built asset structures. The investment adviser’s personnel have extensive expertise in the target homeless accommodation assets sector and have successfully managed a £430m social impact fund specialising in this strategy over the last two years.
The company has a fully independent board of non-executive directors, chaired by Lynne Fennah, CFO/COO of Empiric Student Property, and the other directors are Marlene Wood, Peter Cardwell and Simon Moore.
Fennah said: “We believe a significant investment opportunity now exists in the UK homeless accommodation asset market and the Alvarium team has already identified a substantial pipeline of homeless accommodation assets that we, and the Alvarium team, consider are at low and sustainable rent levels.
“We aim to be part of the solution to the homelessness crisis in the UK, drawing on the Alvarium team’s sector specialist expertise to achieve our objective of delivering secure inflation-protected income and capital returns to shareholders, whilst delivering a positive social impact.”
Home REIT will be managed by Alvarium Fund Managers (UK). Dickson Minto W.S. is acting as sole sponsor to the company, and Alvarium Securities is acting as sole broker, placing agent and intermediaries offer adviser to the company.
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