UK-listed Home REIT, which funds the acquisition and creation of properties that are dedicated to providing suitable accommodation for homeless people, has announced the launch of a placing of new shares targeting a raise of approximately £150 mln (€176 mln) at a price of 115 pence per share.
The proceeds of the placing will be used to acquire further homes in line with the company’s investment criteria.
Lynne Fennah, chair of Home REIT, commented: 'This placing will significantly enhance our capacity to invest in the provision of high-quality accommodation for homeless people across the UK at a time of grave necessity.
'The proceeds will enable us to continue expanding our existing portfolio which is generating inflation-protected income, utilising our strong pipeline of off-market opportunities, and work with our local partners to provide essential long-term support to some of the UK’s most vulnerable people.'
Home REIT’s portfolio is valued at £713.4 mln as at 28 February 2022, providing 8,556 beds to homeless people across the UK, with 28 tenants across England. The firm works closely with 118 local authorities, delivering a 17% EPRA Net Tangible Assets / NAV total return since launch.
The company has grown rapidly since its IPO in October 2020, with the proceeds of a £350 mln oversubscribed equity issue in September 2021 fully deployed within four months, ahead of the stated target.
According to Home REIT, advanced legal negotiations are underway on a £300 mln pipeline of further investment opportunities, with an average net acquisition yield of 5.84%.
The REIT is dedicated to tackling homelessness in the UK, targeting a wide range of vulnerable groups including, but not limited to, victims of domestic abuse, people leaving prison, individuals suffering from mental health or drug and alcohol issues and foster care leavers.
Homes are let or pre-let to robust tenants on long leases (typically 20 to 30 years to expiry or first break), with index-linked or fixed rental uplifts, in order to provide security of income and low cost of debt.
The firm has also implemented a strong ESG framework with clear and independently assessed social impact, as detailed in the company’s good economy report of July 2021, with all properties let on green leases.
