Schroder Real Estate in partnership with UK social impact investor Civitas Investment Management have reached a second closing on their closed-end private Social Supported Housing Fund (SoHo), with total equity commitments raised to date of £100 mln (€110 mln).
SoHo will forward-fund the development of brand-new specialist supported housing in the UK, which has been purpose-built to provide safe, lifelong homes for adults with severe disabilities and significant mental health conditions.
Civitas IM, the impact investment manager which founded and acts as investment adviser to Civitas Social Housing REIT, will oversee the development of the properties.
The homes will enable these individuals to receive dedicated, high-quality care in the heart of their communities and live full, stimulating lives according to their individual capabilities. The housing units already have planning consent and are pre-let on a long-term, FRI, CPI-linked basis to not-for-profit organisations.
The rental obligations are 100% funded by the local authorities in which the residents are located and ultimately paid by central government.
‘The fund was launched in 2019 and almost £50 mln of SoHo’s capital has already been allocated,’ said Robin Hubbard, head of Real Estate Capital at Schroders. ‘The first project completed in July this year and further completions are now taking place each month. The strategy has proven highly resilient to Covid-19 and the Government-backed, strong cash yield on the long-term leases, as well as the clear social impact, are proving popular with institutional investors.’
Andrew Dawber, Group director at Civitas Investment Management, commented: ‘The fact that we have been able to close this latest fundraising successfully during the Covid-19 pandemic and resultant lockdowns is a demonstration of the attractiveness of this specialist asset class to institutional investors.’
PropertyEU reported in June that Civitas was set to enter mainland Europe with the launch of a €500 mln care-based housing fund.
The company, which manages £2.2 bn of assets across three funds in the UK, has been preparing its European entry for the past two years, and is now looking to raise between €260 mln and €500 mln of equity for a new unlisted investment vehicle which will focus on the acquisition of existing assets as well as redevelopment opportunities in the Nordic countries as well as in Germany. The vehicle may also gain a minor exposure to the Spanish market.
Civitas Investment Management is looking to raise the equity from a total of 10-20 European and UK investors over the next 12 months, possibly by the first quarter of 2021.
