The Property Income Trust for Charities fund (PITCH), a £673mln (€808 mln) UK fund with around 50 assets, has acquired the first properties in a move to invest in private residential.
Pitch is being advised by a specialist residential investor, Hearthstone Investments, as it focuses on single-family private rental accommodation, primarily for lower income households.
The fund manager said this came in response to a ‘national shortage of quality, affordable accommodation’ where tenant welfare and high environmental standards are prioritised.
Pitch wants to put an initial £30mln into a portfolio of around 120 homes with a focus on mainstream residential including new build, modern or recent conversions with an average property value of about £250,000.
The strategy will increase PITCH’s exposure to alternatives into a sector that will provide diversification from traditional mainstream commercial property.
There will be a focus on properties offering two to four bedrooms, with a limited allocation to smaller unbroken freehold blocks of flats, typically up to 12 units. The strategy will be diversified across mainland UK suburban areas, including the outer London commuter belt and the big six regional cities, as well as other large urban areas.
The first acquisition comprises 9 nine new build houses in Elmstead Market just to the east of Colchester in Essex, which are currently being developed by Hills Residential and due for
In the twelve months to 31 December 2021, the fund has returned 22.9%, with an annualised return of 7.4%, 8.5% and 9.1% over three, five and ten years. The fund invests for more than 1,200 charities.
Cedric Bucher, CEO of Hearthstone Investments, said its selection by Pitch comes at a time when the asset class has grown from a niche to a mainstream real estate sector in the UK.
Last month, Pitch announced it was doubling down on UK offices, plus it has recently acquired a hotel and warehouse asset. It is managed by London-based Mayfair Capital.
