Civitas Social Housing PLC Acquisition (6011C)
April 18 2017 - 7:00AM
UK Regulatory
TIDMCSH
RNS Number : 6011C
Civitas Social Housing PLC
18 April 2017
18 April 2017
CIVITAS SOCIAL HOUSING PLC
("Civitas" or the "Company")
GBP11.5m Acquisition of a regulated Social Housing Portfolio
The Board of Civitas Social Housing PLC is pleased to announce
it has exchanged contracts on the purchase of a portfolio of
regulated social housing for a total consideration of GBP11.5
million ("the portfolio"). The portfolio includes ten care homes
and 79 tenancies across the Midlands, managed by Inclusion Housing
Association ("Inclusion"), which is regulated by the HCA. This
portfolio was sourced off-market by Civitas Housing Advisors
Limited ("CHA"), the Company's Investment Adviser.
The properties in this portfolio have been used to deliver care
for over twenty years and are fully operational which, on
completion, will immediately generate income with an initial net
yield of 6.3%, based on the purchase price (excluding purchase
costs). Completion is anticipated to be within two months.
Each of the properties within the Portfolio is subject to a
30-year lease arrangement with Inclusion Housing Association with
rents adjusted annually by CPI+1% over the full period and Lifeways
Community Care Limited ("Lifeways") providing the care.
Inclusion specialise in renting and operating social housing and
currently manage over 1,200 properties across 59 local authorities.
It provides principally specialist supported accommodation designed
to meet a range of housing needs for adults with learning
disabilities, mental health and acquired brain injuries. Support is
given to tenants daily from specialist support providers with whom
they partner.
Lifeways, a registered care provider regulated by the Care
Quality Commission (CQC), specialise in providing support and care
to a wide range of people with learning disabilities and other
complex needs. Lifeways works with local authorities and clinical
commissioning groups to structure accommodation and support
packages tailored to individual needs. The Lifeways Group support
more than 6,000 tenants and individuals and employs more than
10,000 staff.
The portfolio was funded through the Company's cash resources.
In due course, it is intended that leverage will be applied to this
portfolio in accordance with the Company's stated policy and it is
expected that this will further enhance the yield achieved from
this investment.
The social homes owned by Civitas are provided on a long-term
basis to Housing Associations with a wide range of tenants who vary
in age profile and in the level of support that each receives.
By acquiring these social homes, and working with Housing
Associations, Civitas seeks for tenants to experience a stable,
high-quality living environment that offers good visibility of
tenure and further, the Company promotes "additionality" by the
provision of new equity capital that has the potential to be
redeployed in the delivery of new social homes.
Civitas targets the objective of delivering sustainable returns
to its shareholders by making socially relevant investments within
the regulated social housing sector in England and Wales.
Amendments to corporate structure
Following advice, the Company will now hold its property assets
directly or indirectly through special purpose vehicles rather than
via the existing LLP structure. The effect of removing the LLP is
to simplify the Group. The Company has entered into a Deed of
Termination in respect of the LLP and made the corresponding
administrative amendments to the Investment Advisory Agreement
which is now termed the Investment Management Agreement. All other
contractual arrangements under this new Investment Management
Agreement including, fees, term and provision of services to the
Group remains the same. Other than the potential to reduce
administration costs there is no other economic effect to the
changes.
For further information, please contact:
Civitas Housing Advisors Limited
Paul Bridge Tel: +44 (0)20 3709 4622
Andrew Dawber Tel: +44 (0)20 3709 4626
Cenkos Securities PLC
Sapna Shah Tel: +44 (0)20 7397 1922
Tom Scrivens Tel: +44 (0)20 7397 1915
Pagefield
Philip Dennis Tel: +44 (0)7947 868206
David Leslie Tel: +44 (0)7584 070274
Notes:
Civitas Social Housing PLC is the first Real Estate Investment
Trust offering pure play exposure to social housing in England and
Wales. The Company is managed by Civitas Housing Advisors Limited.
The Company is listed on the premium listing segment of the
Official List of the Financial Conduct Authority and was admitted
to trading on the main market for listed securities of the London
Stock Exchange in November 2016.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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