(Alliance News) - Residential Secure Income PLC on Thursday said it has acquired 85 new build homes for GBP29 million from Brick By Brick, a development company set up by Croydon Council.
The real estate investment trust stated the portfolio of newly-completed homes which will be delivered as shared ownership properties comprises one, two and three-bedroom apartments in new developments in Upper Norwood, Thornton Heath and South Croydon in south London.
The transaction will be funded through the GBP300 million 45-year debt facility inked in July.
Residential Secure highlighted the deal brings its total shared ownership portfolio to 281 homes, adding that upon occupation, each home will be fully income generating, with an expected inflation-linked leveraged yield which supports the company's total return of 8% and dividend targets of around 5%.
"We are delighted to help Brick By Brick increase its delivery of affordable homes, while generating a return for the London Borough of Croydon. We see this as the start of a long-term partnership with Brick By Brick to facilitate its delivery of much needed affordable homes. This investment further diversifies our portfolio and is a key step to reaching full dividend cover by the beginning of October 2021," said Ben Fry, investment manager of Residential Secure Capital Management.
Shares in Residential Secure closed 0.2% lower at 89.76 pence each on Thursday in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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Residential Sec (RESI)