LONDON 11 January 2019 – CBRE Global Investors has held its first close for the CBRE UK Affordable Housing Fund (AHF), with equity commitments totaling circa £250 million exceeding the target for the first close. The capital raised is from 13 institutional investors including commitments from Big Society Capital (BSC).
AHF is a UK open-ended unlisted fund targeting institutional client capital solely investing in social and affordable housing.
The fund offers investors diversification through exposure to the residential sector with the aim of having a significant social impact. AHF will invest in housing stock in the UK, focusing on social and affordable rented housing, shared ownership as well as other tenures such as key worker housing and homeless hostels. The Fund will partner with registered providers, who will manage the homes and who will be responsible for the rental income, maintenance, property management and tenant engagement.
Head of UK Funds for CBRE Global Investors, Hannah Marshall, said that the fund seeks a 6% target total return, which meets the investment/income requirement of investors while contributing towards social impact. Hannah continued, “institutional investors are placing increasing importance on the environmental, social and governance (ESG) impacts of their investment strategies. 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.
To have Big Society Capital committing to our fund is significant. We are working with The Good Economy to develop a social impact framework which will ensure impact considerations are incorporated into our investment process.”
There is currently no market standard way of measuring and reporting on a Fund’s social impact for affordable housing investments. CBRE Global Investors working together with The Good Economy, along with Big Society Capital and its other investors, are seeking to develop a robust market leading framework.
Michael Ness, Head of UK, CBRE Global Investors added: “There is an increasing demand for low-risk, low-volatility, liability matching cashflows from UK institutional investors and AHF meets those requirements.
The fund complements and enhances our UK offer. AHF sits neatly within our range of products, which includes the Long Income Fund, our core PAIF*, and alongside our sizeable separate account business, offering our clients a wide range of structuring choices.”
The Affordable Housing Fund is an open-ended UK PAIF. It will invest in a mix of tenures either forward funded stock or standing assets. The first investment is expected to close in Q1 2019.
*Property Authorised Investment Fund
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This material may not be distributed in any jurisdiction in which it is illegal to do so. CBRE UK Affordable Housing Fund is authorised by the Financial Conduct Authority (FCA). This Fund is for professional or qualifying investors who are eligible to invest in a Qualifying Investor Scheme (QIS) within the meaning of the FCA Rules only. It is not intended to be distributed or passed on, directly or indirectly, to any other class of persons. It is not available to ordinary retail investors. CBRE Global Investors (UK Funds) Limited obtained its Alternative Investment Fund Managers Directive (AIFMD) licence from the FCA on 15 July 2014 and is the alternative investment fund manager (AIFM) for the CBRE UK Affordable Housing Fund. The FCA granted CBRE Global Investors (UK Funds) Limited an EU AIFMD marketing passport to market the CBRE UK Affordable Housing Fund to professional investors in the following EEA countries: Denmark, Finland, Germany, Netherlands, Sweden & the United Kingdom. Issued and approved by CBRE Global Investors (UK Funds) Limited, which is authorised and regulated by the FCA in the United Kingdom. Target total return numbers are net of managers fees.
About CBRE Global Investors
CBRE Global Investors is a global real asset investment management firm with $104.5 billion in assets under management* as of September 30, 2018. The firm sponsors investment programs across the risk/return spectrum for investors worldwide.
CBRE Global Investors is an independently operated affiliate of CBRE Group, Inc. (NYSE:CBRE). It harnesses the research, investment sourcing and other resources of the world’s largest commercial real estate services and investment firm (based on 2017 revenue) for the benefit of its investors. CBRE Group, Inc. has more than 80,000 employees (excluding affiliates) and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide. For more information about CBRE Global Investors, please visit www.cbreglobalinvestors.com.
*Assets under management (AUM) refers to the fair market value of real asset-related investments with respect to which CBRE Global Investors provides, on a global basis, oversight, investment management services and other advice and which generally consist of investments in real assets; equity in funds and joint ventures; securities portfolios; operating companies and real asset-related loans. This AUM is intended principally to reflect the extent of CBRE Global Investors’ presence in the global real asset market, and its calculation of AUM may differ from the calculations of other asset managers.
About The Good Economy
The Good Economy, founded in 2015, is a social advisory firm focused on the role of business and finance in creating an economy that works for everyone. We provide advisory, research and impact management services to investors, business, government and social purpose organisations. Our work includes developing practical, user-led, social impact measurement and management systems that can be used for business and investment decision-making.