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Civitas and global asset manager raise £192m for supported housing fund
Global asset manager Schroders Capital and Civitas Investment Management have closed their supported housing fund with total equity commitments of £192m.
The pair said the Social Supported Housing Fund, which has just completed its third and final funding round, will deliver £300m of new supported housing with leverage.
Investors from the UK, the US and Singapore, including pension funds, insurance companies and charitable foundations, have put money into the partnership.
Schroders Capital manages assets worth around £48.5bn, including property, private equity, venture capital and private debt.
It is part of Schroders Plc, which is responsible for £700.4bn of assets worldwide.
Civitas Investment Management describes itself as a “leading impact investment manager”, with £2.5bn of committed capital and a target to surpass £4bn in the next three years.
It specialises in specialised supported housing, a niche tenure mainly aimed at adults with learning difficulties or mental and physical disabilities. It commands very high rents covered by housing benefit.
The model involves leasing properties on long-term deals to housing associations or community interest companies.
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Last month, Inside Housing reported that Civitas Investment Management advised a large Hong Kong-based property investor on the acquisition of £350m in UK supported housing last year.
Civitas Investment Management also founded a publicly listed real estate investment trust in 2016, called Civitas Social Housing Plc. It now has a portfolio worth £915.6m.
The Regulator of Social Housing has declared nine of Civitas Social Housing’s 16 housing provider partners non-compliant, most recently Auckland Home Solutions.
The Social Supported Housing Fund (SoHo) will forward-fund the development of new purpose-built specialised supported housing.
Schroders and Civitas said it will help “ease the considerable shortfall” of supported housing in the UK, providing “dedicated, high-quality care” for residents in the community while providing better value for the taxpayer than institutional or hospital care.
Robin Hubbard, head of real estate capital at Schroders, said: “This success highlights investors’ interest in Schroders’ and Civitas’s capabilities in this field and that impact has risen up investors’ agendas over the last year, not just in the UK but globally, as fiduciaries as well as their underlying beneficiaries and policyholders seek social and environmental returns alongside financial targets.
“Prominent investors with an impact-focused commitment include the Church Commissioners for England and Jonathan Rose, a highly respected developer of innovative housing communities in the US, through his Lostand Foundation.”
Andrew Dawber, group director at Civitas Investment Management (CIM), said: “This final closing is a major milestone for CIM’s partnership with Schroders.
“SoHo’s prime objective is creating new specialist property supply for some of the most vulnerable individuals in society, and with 11 schemes already operational and another 50 in the pipeline, the fund looks set to generate genuine ‘additionality’, alongside an attractive risk-adjusted return.
“We are delighted to welcome new investors to the fund and believe that despite the challenges associated with investors undertaking on-site due diligence during the ongoing pandemic, the considerable demand reflects the attractiveness of this asset class and its positive social impact credentials to institutional investors.
“CIM and Schroders are firm believers in the power of private capital to influence and deliver positive changes to society.”
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