(qlmbusinessnews.com via telegraph.co.uk – – Wed, 12 Sept 2018) London, Uk – –
An investment trust aiming to compete against buy-to-let landlords in the booming private rental market will fire the starting gun on its £175m London IPO on Wednesday, The Daily Telegraph understands.
Multifamily Housing REIT is thought to be planning to use £70m of the cash to buy an initial seed portfolio of around 650 flats homes and five commercial premises across 22 housing blocks, mostly in the north of England, the midlands and the south-west.
The trust, set up by Harwood Capital’s real estate arm, will be the first listed vehicle to focus exclusively on pre-built rental homes.
The private rental market has ballooned in recent years amid a fall in home ownership and is mostly still in the hands of non-professional buy-to-let landlords.
It has begun to attract institutional investment from the likes of Legal & General and M&G but mostly in the form of so-called build-to-rent developments, which are generally targeted at upwardly mobile urban professionals willing to pay top dollar for the latest mod cons.
Multifamily Housing will buy existing rental homes rather than building them itself and is understood to be targeting the more affordable end of the market.
It plans to raise the cash by selling 175m shares at £1 each.
The REIT will be chaired by Nick Jopling, who previously ran Grainger, one of the UK’s largest professional landlords. David Lis, formerly head of equities at Aviva Investors, will also be on the board.
It has already identified a £422m pipeline of potential investments and is aiming to generate a dividend yield worth 4pc per year from the date of its admission, rising to 5pc from March next year.
Harwood was spun out of JO Hambro in 2011 and is still led by its former parent company’s founder Christopher Mills and now has around £4.5bn of funds under management.
By Jack Torrance