Schroders and Civitas Investment Management announce first completions in UK social housing impact strategy

Schroder Real Estate in partnership with Civitas Investment Management (“CIM”) are pleased to announce that the first five projects to be funded by their Social Supported Housing Fund (“SoHo”) have been completed and handed over to their housing association tenants and residents.   

These projects represent the first completions from a much larger pipeline of contracted projects across the UK, with further developments now completing each month.

This is significant as there is a chronic lack[1] of appropriate social supported housing in the UK and the Fund is bringing additional new homes into the sector. 

The strategy of the SoHo fund is to forward-fund the development of c. 2,000 homes across the UK, thereby creating an institutional portfolio of brand-new specialist housing units that have been purpose-built to provide safe, lifelong homes for adults with severe learning disabilities and significant mental health conditions.

Prior to investment by the Fund, the sites will already have planning consent and be pre-let on long-term leases. The rental obligations are 100% funded by the local authorities in which the residents are located and are ultimately paid by the UK central government as part of its statutory obligation under The Care Act 2014.  

There is a chronic shortage in the UK of homes which are specifically designed for working-age adults with complex care needs. The homes funded by SoHo will enable residents to receive dedicated, high-quality care in the heart of their communities and live full, stimulating lives according to their individual capabilities.

It is well established that living in the community close to family and friends results in significantly better physical, mental and social outcomes for residents than institutionalisation or long-term hospitalisation.

Schroder Real Estate has been investing in UK real estate for almost 50 years. In the last few years, impact investing has become integral to its investment philosophy and we believe the SoHo partnership demonstrates how social impact can be achieved without constraining financial returns for investors.

CIM, the leading impact investment manager which founded and also acts as investment adviser to Civitas Social Housing REIT PLC, is overseeing the development of the properties, drawing on its in-depth experience of providing bespoke supported housing for vulnerable adults with significant care needs.

Robin Hubbard, Head of Real Estate Capital at Schroders, commented:

“It is very pleasing to see the Fund’s strategy become a reality with the completion, delivery and occupation of the first set of purpose-built homes. They will enhance their residents’ quality of life significantly, and their social impact will be independently measured and reported.

“‘Additionality’ is an important aspect of the Fund and, with our now-proven ability to successfully industrialise the development process in a timely and cost-effective manner for the public sector, while seeking to achieve an attractive risk-adjusted return for investors, we believe this is a win-win for all the stakeholders involved.”

Andrew Dawber, Group Director at Civitas Investment Management Limited, commented:

“The UK has a severe shortage of specially-designed homes for working age adults with severe and complex care needs. Both the public and the private sectors have an important role to play in providing additional housing, and we are committed to doing our bit in partnership with Schroders.

“These housing projects, which were funded from last October, were a result of the collaboration between local authorities, developers, care providers, housings associations and SoHo. We hope that they will set the standard for proactive collaboration in creating high quality housing for people with lifetime care needs.”

 

[1] National Housing Federation