TIDMHOME
RNS Number : 1646Z
Home REIT PLC
13 September 2022
13 September 2022
Home REIT plc
("Home REIT" or the "Company")
HOME REIT ACQUIRES 158 PROPERTIES FOR GBP57.4 MILLION
Home REIT plc (ticker: HOME), which funds the acquisition and
creation of high-quality properties across the UK that are
dedicated to providing accommodation to homeless people, announces
that it has acquired 158 additional properties (the "Properties")
located across England for an aggregate purchase price of GBP 57.4
million (including acquisition costs).
These acquisitions were funded by the net proceeds raised via
the Company's oversubscribed GBP263 million equity issue in May
2022 (the "Subsequent Placing"), of which the Company has now
deployed a total of GBP 227 million ( 88 per cent.) of the
proceeds. The acquisitions adhered to the Company's strict
investment criteria, providing much needed accommodation for
vulnerable homeless people across England.
The Properties have added a further 711 beds for those in need
to the portfolio, bringing the portfolio total to 11,131 and
further enhancing the Company's geographic diversification. They
are let on an average lease length of 25 years at low and
sustainable rents, on new, unbroken, long-term, full repairing and
insuring leases to specialist registered homeless charities and
community interest companies ("CICs"), providing them with
sought-after long-term security of tenure. 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 per cent. and 4
per cent. respectively.
Each of the Properties is immediately income producing and,
following these transactions, the blended net initial yield of the
Company's portfolio is ahead of expectations.
The purchase of the Properties was made from the Company's
attractive c. GBP300 million acquisition pipeline, which has been
under due diligence and legal negotiation since earlier this year.
This pipeline was in an advanced stage of preparation ahead of the
Subsequent Placing and assembled through the Company's deep network
of relationships, according to the specific need within each local
authority area.
Gareth Jones, Partner at Alvarium Home REIT Advisors Limited,
said :
"These acquisitions add high-quality beds to our expanding
portfolio and are aligned with our strategy to provide tailored and
fit-for-purpose accommodation for people across the UK facing
homelessness. The transactions build on our strong track record of
deploying funds swiftly and efficiently to secure assets that offer
long-term sustainable income. As the societal challenge around
homelessness becomes sadly more critical, we continue to source
opportunities to grow the number of beds we can provide to help
areas where this need is particularly acute."
The Company's combined portfolio to date
-- High quality, much needed accommodation for vulnerable,
homeless people, providing critical housing solutions for people
fleeing from domestic abuse, those faced with homelessness due to
poverty, people suffering from drug and alcohol abuse and mental
health issues, prison leavers and ex-armed forces.
-- Low and sustainable rents across the portfolio, providing
significant savings to local authorities compared to less suitable
alternative accommodation.
-- Let 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 homeless people and a focus on care, support, training and
rehabilitation to provide them with the skills and confidence to
find long-term accommodation and enable them to reintegrate into
society.
-- All the rent payable by Home REIT's tenants is funded by
support from local and central government.
-- Providing 11,131 beds across 2,308 properties.
-- Following the acquisition of the Properties, the Company's
portfolio is further diversified across 132 different local
authorities and 29 tenants, with the following geographical
exposures (by asset value):
o London: 15.6%
o Yorkshire and the Humber: 13.7%
o East Midlands: 11.8%
o North West: 14.3%
o North East: 14.3%
o South West: 8.6%
o West Midlands: 8.1%
o South East: 6.8%
o East: 6.0%
o Wales: 0.8%
FOR FURTHER INFORMATION, PLEASE CONTACT:
Alvarium Home REIT Advisors Via FTI Consulting below
Limited
Gareth Jones
Charlotte Fletcher
Alex Baker
Alvarium Securities Limited
Mark Thompson +44 (0)20 7016 6711
Eddie Nissen +44 (0)20 7016 6713
Oliver Kenyon +44 (0)20 7016 6704
FTI Consulting (Communications HomeREIT@fticonsulting.com
Adviser) +44 (0)20 3727 1000
Dido Laurimore
Eve Kirmatzis
Ellie Perham-Marchant
Oliver Harrison
The Company's LEI is: 213800A53AOVH3FCGG44.
For more information, please visit the Company's website:
www.homereituk.com
About Home REIT plc
Home REIT plc seeks to contribute to the alleviation of
homelessness in the UK, whilst targeting inflation-protected income
and capital returns, by funding the acquisition and creation of a
diversified portfolio of high-quality and low-cost accommodation
assets across the UK which are dedicated to providing accommodation
to homeless people. The accommodation assets are let or pre-let on
very long (typically 20 to 30 years) leases, containing
inflation-linked or fixed uplift rent review provisions, 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
homeless people and which receive housing benefit or comparable
support from local or central government to fund the provision of
such accommodation to homeless people.
There is a critical need for further accommodation for homeless
people in the UK, due to an increasing homeless population and a
lack of available and affordable high-quality, fit-for-purpose
stock to address the problem. Local housing authorities are under a
statutory duty to secure accommodation for individuals who are
unintentionally homeless and in priority need but current
accommodation for homeless people is limited in quantum and often
sub-standard and uneconomical.
The Company focuses on investing in and creating well-located
properties that provide a sustainable level of rent for the tenant.
Within the homeless accommodation assets, there is a focus on care,
support, training and rehabilitation to provide vulnerable homeless
people with the skills and confidence to find long-term
accommodation and enable them to reintegrate back into society.
Savings are expected to be made to local authorities and other
providers of accommodation to homeless people via lower rents
versus more expensive alternative accommodation.
The Company is listed on the premium segment of the Official
List of the UK Financial Conduct Authority and its Ordinary Shares
were admitted to trading on the main market of the London Stock
Exchange, premium segment, on 12 October 2020.
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END
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