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Investment firm launches new partnership targeting shared ownership market
Investment firm Gresham House is planning to launch its new limited partnership Gresham House Residential Secure Income (GH ReSI), which will target institutional investors and local government pension schemes (LGPS) looking to invest in shared ownership properties.
Gresham House, which also owns the real estate investment trust (REIT) ReSI, said that investment in the UK shared ownership residential property market can deliver a “quantifiable social impact” that will be appealing to investors.
The new limited partnership will invest through its wholly owned subsidiary, ReSI Homes Limited, a for-profit registered provider which has access to homes funded by government grants acquired at a bulk discount, or those subject to Section 106 planning restrictions.
In March, Gresham House acquired TradeRisks, the parent company of ReSI Capital management – the fund manager of ReSI.
The asset manager said that shared ownership delivers a social dividend by offering rents at below market rates and offering rent subsidy worth 25% of market rent, saving shared owners at least £2,000 a year.
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The strategy will have an initial rental yield of 3.4% per annum, increasing at retail price index plus 0.5% annually. GH ReSI will target a sustainable dividend yield in excess of 3% per annum.
It will be run by the 20-strong Gresham House housing team, which currently manages the £310m ReSI REIT.
Ben Fry, investment manager of GH ReSI, said: “Undersupply and decreasing affordability are pushing homeownership beyond the reach of many in the UK today.
“Through our status as a registered provider, we are able to help address the housing crisis by providing much-needed affordable homes while offering investors access to an under-addressed market.”
Tony Dalwood, chief executive of Gresham House, said the new strategy represents the latest milestone in the group’s sustainable investment offering.
He added: “This specialist investment strategy… will not only unlock new supply of more affordable homes across the UK, it will generate economic activity and fiscal savings to the benefit of the entire economy.”
Mr Dalwood said the social impact should “resonate with investors” who are increasingly looking for strategies that benefit society and the environment.
