CBRE Global Investors has secured equity commitments of around £250 mln (€276 mln) at the first close of its CBRE UK Affordable Housing Fund (AHF), exceeding targets.
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.
'Institutional investors are placing increasing importance on the environmental, social and governance (ESG) impacts of their investment strategies,' said Hannah Marshall, head of UK funds for CBRE GI.
'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.'
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.
'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,' Marshall added.
'There is an increasing demand for low-risk, low-volatility, liability matching cashflows from UK institutional investors and AHF meets those requirements,' concluded Michael Ness, head of UK, CBRE GI.
The fund's first investment is expected to close in Q1 2019.