The Board of Civitas Social Housing PLC has announced that they have completed the purchase of two portfolios that contain regulated social housing. It is thought that the total consideration for the housing was £19.3 million. The portfolios are made of the freehold interest in 19 different supported living properties that have a combined total of 98 tenancies. The two portfolios acquired by Civitas will immediately generate income, and they have net yields that are in line with the Company’s expectations. Both of these portfolios have been sourced by Civitas Housing Advisors Limited off market by the Company’s Investment Manager.
Portfolio one was acquired for the total consideration of £2.6 million. This portfolio has 15 tenancies from 3 properties in the North West of England. Each of the properties that are in the first portfolio are subject to a 25-year lease with Trinity Housing Association, a specialist Housing Association that focuses on supported living and rents that are established by the relevant local authority and adjusted each year so that they are in line with inflation over the full period of the lease. Trinity Housing Association is a Registered Provider that is regulated by the Homes and Communities Agency who also has counterparty leases in Civitas’ existing portfolios.
The second Portfolio was acquired by Civitas Social Housing for a total consideration of £16.7 million and is made up of 83 tenancies. These tenancies are spread across 16 properties in the East Midlands, West Midlands, the South East, South West of England and Greater London. The properties in this portfolio are also subject to a 25-year lease as in the first acquisition, and are leased to two different Housing Associations, Westmoreland and First Priority Housing Association.
Both of the acquisitions were funded through the cash resources of the company and it is thought that in time leverage will be applied in accordance with Civitas’ stated policy. The properties in these portfolios have been adapted for specialist supported living for those with physical and/or mental disabilities or other care needs.
