CBRE Global Investors has raised £250m for a new affordable housing fund that is going to partner with affordable housing providers, including us.
CBRE are expecting 2,000 properties to be acquired by the fund over the next two years. New forward-funding deals will help to invest in a variety of different tenures through various housing providers.
The head of UK funds for CBRE GI, Hannah Marshall, has said that the fund would target a total return of 6%.
“Institutional investors are placing increasing importance on the environmental, social and governance (ESG) impacts of their investment strategies,” she said. “Our strategy contributes towards our investors’ ESG targets and generates a positive social impact as we invest in the funding of homes for those households unable to afford to rent or buy in the open market.”
One of the partners is Step Forward (us), who plans to use the funding to increase the number of homes it provides for ex-service personnel and emergency workers.
Speaking to Property Week last April when Step Forward had just opened its 100th home, director Chris Metcalf said the firm was close to agreeing on a deal with “one of the biggest institutional funders in the property market”.
Metcalf said there was a growing need for institutional money to help combat the shortage of social and affordable housing.
“Local authorities are finding it difficult to deliver the social and affordable housing they said they would and housing developers have no interest in developing this type of stock, so there is an opportunity for private finance to deliver those types of homes,” he said.