Social housing investment company secures £40.2m deal for retirement home build

London-based Residential Secure Income plc (ReSI) has exchanged contracts to acquire a 478-property retirement homes portfolio from Places for People, one of the UK’s biggest housing associations.

The consideration is worth £40.2m, generating a yield in line with ReSI’s previous retirement home acquisitions. ReSI invests in residential asset classes that comprise the stock of UK social housing providers.

The acquisition has already been completed for the large majority (421) of the properties, thus immediately produces income, with completion of the remainder (57) anticipated within three months.

Ben Fry, of ReSI Capital Management Ltd, ReSI’s fund manager, said: “This acquisition complements our existing portfolio of retirement flats.

“The portfolio offers a later-life independent living solution with security of tenure but without the hassles of ownership, and serves a fast growing, yet hugely fragmented and underserved, sector of the market.

“Our strategy continues to be focused on delivering a secure, long term income stream to shareholders. We are making good progress in building a high quality portfolio that meets these disciplined investment criteria, and expect this progress to continue.”

The portfolio consists primarily of one-bedroom flats and is located across 284 purpose-built retirement schemes, with over 93 per cent located in South England, including the Greater London area.

The properties are held on a long leasehold basis, with a weighted average unexpired lease term of 92 years.

Following this acquisition, ReSI will have invested £215m in assembling a portfolio which comprises 2,414 residential units.