Home REIT will ditch its focus on homelessness after shareholders approved “stabilisation” plans.
At a general meeting yesterday the REIT passed the motion that it should adopt a new investment policy and appoint AEW UK as its new AIFM and investment manager.
The proposals were passed by a comfortable majority, with 99.98% of those who voted – accounting for 70.69% of the REIT’s issued share capital – approving the motion.
As a result, AEW UK has officially replaced Alvarium Fund Managers as the company’s AIFM with immediate effect.
Home REIT chair Lynne Fennah said: “Shareholders have overwhelmingly supported our proposal and we can now focus on our continuing work with AEW to maximise value. AEW’s appointment as the company’s investment manager and AIFM is an important step. Following the company’s announcement of AEW’s appointment as property adviser on 23 May 2023, AEW has begun several critical workstreams to stabilise the company’s property portfolio and maintain its mission of providing accommodation to vulnerable people.”
Under the plan, Home REIT will drop its social purpose during a “stabilisation period” of up to three years. During this time AEW will have the freedom to invest in “any form of residential use”.
Following this period, the REIT said investment would be widened to “residential accommodation assets having any social use”.
The REIT said it meant real estate used to house vulnerable individuals, including, but not limited to, “homeless, ex-service men and women, individuals fleeing domestic abuse, vulnerable women, people leaving prison, asylum seekers and refugees, foster care leavers, substance misuse, care leavers, mental illness, disability, specialist supported living and general needs social housing”.
Shareholders were told if they did not back the plan, AEW would not be able to take on the position of investment manager “and the board will need to consider an alternative strategy”.
Nick Winsley, head of AEW UK, said: “Today’s result will allow us to continue to execute our stabilisation strategy for the company’s portfolio. Protecting the interests of all of Home REIT’s stakeholders remains at the forefront of our agenda.”
The REIT was forced to take the steps after a series of revelations about the strength of its covenants and purchasing practises led it to suspend its shares. Last month it confirmed that it had managed to collect just 7% of the £8.77m it was owed for the quarter. Days later two of its key tenants, representing 12% of its leases, entered liquidation.
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