January 2022 Pipeline Update
As we move into 2022 we have a healthy pipeline of property we hope to launch in the first few months of the year with leases already agreed with our partners.
Nacro
We are looking to conclude the purchase of a property in Orpington, Kent that will be leased to Nacro and will be used to fulfil one of their government contracts. After being due to exchange in the summer, problems up the chain have delayed this purchase several times but now we seem set to complete in the coming weeks. This 3-bedroom property will be set up as a shared house and will require some upgrade works to bring it up to lettable standard. We hope to conclude these works by the end of April but the investment will offer a 5.5% yield from launch.
Mears
At the end of January, we also hope to conclude another purchase that was delayed from just before Christmas. This investment consists of two 6-bed houses of multiple occupation in Stockton which are to be used to house asylum seekers and will yield 5.6% upon launch. There were some issues raised in the surveys that needed to be addressed prior to completion and remedial works are currently underway. On completion a 5-year lease with Mears will begin. We are aware of some of the bad press surrounding the poor conditions of some of the properties used to house asylum seekers, but we can offer assurance that we are committed to delivering good quality housing that is fit for purpose.
Golden Lane Housing
As we move into February we will start to deliver on the 12 properties in the pipeline that will be leased to Golden Lane Housing (and that we have had offers accepted on). This is a key partnership for us this year and we expect the number of properties in the pipeline to continue to grow significantly. Golden Lane split their housing teams by region with England split into the South, Midlands and North. The properties have primarily been needed in the Midlands region but we are now also seeing more need in the South. The properties are required for tenants with a range of needs including learning disabilities as well as requirements for improved accessibility in some instances. One of the tenants is actually a member of the GB disabled gymnastics squad and we are enabling her to gain more independence by moving to a home that is just 5 minutes from her family. All these opportunities should yield around 5%.
Whilst both Nacro, Golden Lane Housing and Mears are substantial and well established national organisations we are also keen to work with smaller charities and housing associations. These may be local and quite small but are still established and offer valuable services to the community.
Harmony Children’s Services
This applies to two of the investment opportunities we have coming up in Huddersfield. The first is a run as a children’s home called the Hollies (http://www.harmonycs.co.uk/the-hollies/) by Harmony Children’s Services who are a care provider rated ‘Outstanding’ by OFSTED. The property provides a home for three children who live as a family unit with carers. Harmony runs three homes with the first set up in 2011 and are excited about how they can work with Assetz Exchange going forward to grow their business. The opportunity will yield around 6%.
The Independent Living Project
We are also hoping to conclude the purchase of a block of 8 x 1-bedroom apartments used to house young adults leaving the care system and support them in learning the skills they need to live independently in society. This opportunity will offer a full repairing and insuring lease with The Independent Living Project. They have run the scheme since 2009 and we understand they have had an average occupancy of over 90% (excluding the first year when they were becoming established). This is the largest of three schemes they run in the town with a current occupancy of 100%. The opportunity will offer around 5.5% yield.
We continue to have discussions with charities and other organisations that are keen to work with us and feel our model can offer them real value so please keep an eye on our pipeline page for the latest updates.
Example properties in pipeline
| Town and postcode | Orpington BR5 | Stockton TS18 | Wem SY4 | Nuneaton CV10 | Huddersfield HD3 | Huddersfield HD1 |
|---|---|---|---|---|---|---|
| Charity | Nacro | Mears | Golden Lane Housing | Golden Lane Housing | Harmony Children’s Services | Independent Living Project |
| Occupants | Homeless | Asylum seeker | Learning disability | Learning disability | Children | Care leaver |
| House type | 3 bed terraced house | 2 terraced 6 bed houses | 3 bed new build bungalow | 3 bed semi detached house | 4 bed detached house | 8 one bed flats |
| Net Price (£) | 355,000 | 340,000 | 299,950 | 175,000 | 370,000 | 865,000 |
| Lease length (years) | 10 | 5 | 5 | 5 | 10 | 9 |
| Yield | 5.5% | 5.6% | 5.0% | 5.1% | 6% | 5.5% |
| Completion | Jan 2022 | Jan 2022 | Feb 2022 | Feb 2022 | Feb 2022 | Feb 2022 |
Tenant profile → Nacro
Nacro is a social justice charity founded in 1966. One of Nacro’s main aims is to ensure that disadvantaged young people and adults reach their full potential in life. Good quality and appropriate housing is often the first step to unlocking this potential by laying the foundations for stability and improvement. Housing is, therefore, integral to Nacro’s work.
Over the last 50 years, Nacro has developed specialist housing knowledge and expertise in delivering housing solutions for vulnerable groups. This includes people that have experienced homelessness due to current challenges in the housing market.
Nacro currently provides a range of accommodation options including supported housing, floating support services and Nacro’s social lettings agency – Nacro Homes Agency.
Tenant profile → Golden Lane Housing
Golden Lane Housing is one of the country’s leading supported housing landlords for people with a learning disability. They were established as an independent registered charity by Mencap in 1998 to help tackle the immense challenges that people with a learning disability face in finding a home. Recognising that people with a learning disability have different wants and needs when it comes to their home, they provide high quality rented housing tailored to meet a person’s specific needs across England, Wales and Northern Ireland.
They adopt a joined-up approach to provide housing solutions, building good relations with individuals, families, social services, nearly 160 support providers including Mencap, local authorities, housing associations, developers, landlords and other organisations.