K&C REIT plans to invest £400m in the UK’s private-rented housing after announcing plans to raise £150m (€168m) by issuing shares at £1 each.
The residential real estate investment trust (REIT), established in 2015, has to date made small acquisitions, but intends to begin buying larger assets.
K&C REIT was admitted to London’s junior investment market AIM in 2015, after which it bought Coleherne in West London for £3.6m and Osrey for £1.6m. This week, the company said it had agreed new debt facilities of up to £100m and had identified a £400m pipeline of investments.
Duncan Walker, former investment director at FTSE 250 property company Helical, has also joined as a non-executive director.
K&C said it had successfully demonstrated the concept of using a REIT structure to acquire residential property at a significant discount to market value and wanted to acquire larger portfolios.
The property contained within Coleherne has been independently valued at £4.2m, an increase of 16% on the purchase price, while the properties within Osprey – including three additional apartments acquired for £935,000 in July this year – had been valued at £4.4m, an increase of 73% on the aggregate purchase price.