Hearthstone Investment Management’s UK housing fund has received further capital commitments from UK local authority pension funds to raise just over £200m (€230.1m) at final close.
The Merseyside Pension Fund and the Tyne and Wear Pension Fund have joined the Hearthstone Residential Fund 1 (HRF1) as new limited partners in the final investment round bringing the total number of investors to seven UK local authority pension funds.
As previously reported, Derbyshire Pension Fund, Nottinghamshire Local Government Pension Fund, Staffordshire Pension Fund, Teesside Pension Fund and West Midlands Pension Fund are cornerstone investors in the 10-year fund.
The five pension funds invested £100m in Hearthstone’s debut closed-ended private rented sector fund, which set out to raise £200m.
Councillor Paul Doughty, chair of Merseyside Pension Fund said since achieving its first close in December 2017 with assets of just over £100m, HRF1 has delivered on its investment strategy focused primarily on new build housing and low-rise blocks of flats across the UK regions.
To date the fund has invested in the Midlands, the North West, the North East Region, Southern England and Wales, Doughty said.
“Its objective is to build and manage to a high standard a portfolio of mainstream rental properties with the interests of tenants, their communities and institutional investors aligned.
“This is consistent with our objective to support needed housing development in the region.”
Cristoforo Rocco di Torrepadula, a partner and director of investor relations at Hearthstone Investment Management, said: “We are delighted to close on schedule our first fund, HRF1, in this key sector.
“Exceeding our target fund size is a powerful affirmation of our strategy and ability to source, acquire and manage desirable properties in locations that offer sustainable employment, social and community infrastructure and that combine the aspirations of tenants with the stable income returns expected by our institutional investors.”