UK's largest impact investing fund closes at £57m
The Real Lettings Property Fund has received an additional £10.3m, bringing the total value of the UK’s largest impact investment fund to just under £57m.
The fund, which buys properties to let to homeless people in London, has now closed to new investors after receiving the additional investment from Croydon Council, Trust for London, Panahpur and a high net worth individual.
The fund was launched in early 2013 and is managed by impact investment company Resonance in partnership with homelessness charity St Mungo’s Broadway. The fund's properties are let through St Mungo's Broadway's social lettings agency, Real Lettings, which the agency finds gives better quality properties than negotiating with individual landlords.
Simon Chisholm, investment director at Resonance, said: “The fund combines financial returns to investors with a focused social impact, breaking down barriers for those ready for independent living but excluded from the private rented sector. The successful final close at nearly £57m has proven that it can be scaled up effectively.”
In the two years since it was launched, the fund has bought or is in the process of buying approximately 240 homes. Of these, 120 have been handed over to Real Lettings to be let and 50 are currently being refurbished.
Director of Real Lettings Susan Fallis said: “Since the fund started we have been able to help more people escape homelessness by providing a secure tenancy and support.
“As a result, a significant number of families have been prevented from spending long periods of time in unsuitable temporary or bed and breakfast accommodation or having to move outside London away from their support networks.”
To date, 230 people have moved into a home with a secure tenancy through the fund.
Chisholm said: “The fund’s ability to guarantee a predictable volume of properties that can be offered at affordable rental rates and which provide a sensible risk-adjusted return to investors, means St Mungo’s Broadway can move more people from homelessness into new transitional accommodation that supports them on a path to secure independent living in the future.”
Other investors into the RLPF include L&Q, Big Society Capital, City of London, Esmee Fairbairn and Lankelly Chase.
Chisholm explained that Resonance has completed work which demonstrates that the fund's model “could be effective in other areas” and that the investment company is close to launching further similar initiatives across the UK.
Photo credit: Garry Knight