Home REIT plans London IPO

The real estate investment trust will invest in accommodation that will be let to organisations that receive housing benefit or other government funding

Home Reit, a vehicle that aims to invest in property providing accommodation for the homeless, said on Monday it plans to raise around £250 million (S$447.4 million) by listing on the London Stock Exchange.

Backed by Alvarium Investment, Home Reit will seek to acquire or create new accommodation for the homeless to meet "significant demand", it said in a statement.

It cited a 2018 estimate from the charity Shelter that over 320,000 people in Britain are sleeping rough, in homeless shelters or other temporary housing.

The vehicle will invest in a diversified pool of real estate assets that will be let to charities, housing associations, community interest companies and other regulated organisations that receive housing benefit or other government funding.

We believe a significant investment opportunity now exists in the UK homeless accommodation asset market, Lynne Fennah, chairman of Home Reit plc, said in a statement.

The Alvarium team has already identified a substantial pipeline of homeless accommodation assets that we, and the Alvarium team, consider are at low and sustainable rent levels, Fennah said.

The vehicle is targeting a net total shareholder return of at least 7.5 per cent per year, it said.

The investment strategy is to be part of the solution to the homelessness crisis in the UK while delivering inflation-protected income and capital growth over the medium term for shareholders.

The company said it plans to invest in a range of facilities including those aimed at women fleeing domestic violence, people leaving prison, individuals suffering from mental health or drug and alcohol issues and foster care leavers.

It is aiming to complete the IPO and start trading by mid-October.