Civitas Social Buys Income-Generating Portfolio For GBP17 Million

LONDON (Alliance News) - Civitas Social Housing PLC on Monday said it has purchased a portfolio ...

Alliance News 3 April, 2017 | 12:02PM
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LONDON (Alliance News) - Civitas Social Housing PLC on Monday said it has purchased a portfolio of regulated social housing for GBP17.0 million, and said these assets will generate income immediately with a net yield of 6.0% based on the purchase price.

Civitas Social Housing said the portfolio consists of freehold interest in 16 supported living properties with 92 tenancies across the south of England.

Each of the properties within the portfolio is subject to a 25-year lease with one of two specialist housing associations - Westmoreland Supported Housing Association and Trinity Housing Association - focused around supported living, with rents established by the relevant local authority and adjusted annually in line with CPI inflation over the full period.

Both housing associations are registered providers, regulated by the Homes & Communities Agency. Westmoreland is a counterparty to leases within the company's previous portfolios. Trinity provides bespoke accommodation that is designed to meet the needs of vulnerable adults.

"The properties in the portfolio have been, or will be, adapted for use as specialist supported living homes for tenants with physical and/or mental disabilities or other care needs, and a care provider for each property is in place," said Civitas.

"The portfolio was funded through the company's cash resources. In due course it is intended that leverage will be applied to this portfolio in accordance with the Company's stated policy and it is expected that this will further enhance the yield achieved from this investment," Civitas added.

Civitas said it has invested GBP106.0 million in total following the acquisition, excluding purchase costs, in 487 tenancies and 83 individual properties across the country.

"The social homes owned by Civitas are provided on a long-term basis to housing associations with a wide range of tenants who vary in age profile and in the level of support that each receives," said Civitas.

"With the acquisition of this additional portfolio of properties, Civitas has successfully deployed GBP106 million of capital into the social housing sector. This is very much in line with the strategy we set out at the time of the company's IPO in November. As it currently stands, Civitas' overall portfolio comprises a diverse range of social housing across England and Wales," added Chairman Michael Wrobel.

Civitas shares were down 0.2% at 107.75 pence on Monday.

By Joshua Warner;; @JoshAlliance

Copyright 2017 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Civitas Social Housing Ord 98.80 GBX -0.90 -

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