Aviva Investors buys £71m portfolio of care homes for long-lease fund

Aviva Investors has acquired a portfolio of care homes in the UK for £71m (€81.1m) and plans to complete several further new investments this year.

Aviva Investors said its Lime Property Fund bought the portfolio from Frontier Estates as part of its continued investment in long-income real estate in the UK.

Lime Property Fund is a secure-income, long-lease property fund with a net asset value of more than £2bn. The fund, launched in 2004, targets property investments let to strong tenants on leases with inflation-linked or fixed-rental uplifts and lease terms of at least 15 years.

The forward funding will take place over the next two years and, once completed, the property will be let to One Housing for 30 years, Aviva Investors said.

The assets are located in Bedford, Letchworth, Flitwick and Watford and will include 308 beds of purpose-built care home provision.

The transaction follows the recent investment in a modern office building in Bristol, pre-let on a 15-year lease to Babcock Integrated Technology and the fund plans to complete several further new investments this year.

Mark Wells, origination manager, Aviva Investors, said: “Frontier Estates is developing an impressive, high quality care home offering over these four sites. Coupled with a strong tenant in One Housing, this creates a robust investment for the Lime Property Fund.

“We are actively investing in such properties and have a strong pipeline of ongoing opportunities that will support our efforts to grow the platform.”

Aviva Investors is the global asset management business of Aviva, the FTSE 100 listed insurer.