(London) Aviva Investors, the global asset management business of Aviva plc (‘Aviva’), has acquired, through its Lime Property Fund, a portfolio of 73 Supported Living properties located across the UK, adding to its portfolio of high-quality, long-income real estate assets. The deal provides funding for the properties to Big Help, a registered charity based in Liverpool, and releases capital tied up in property holdings to enable Big Help to invest in other parts of their business.
The properties are let to Big Help Asset Management (“Big Help”) on a 30-year income strip lease with annual upwards-only reviews to CPI with a cap of 5%. Big Help are a fast-growing charity providing a variety of services to those in need, such as accommodation; food banks; ethical retail stores; financial advice; employability advice; and wellbeing provisions. This transaction was a sale and leaseback for a total sum of £55,000,00. This capital receipt helps Big Help to fund the cost of the properties, which make up part of their portfolio of c.3,500 properties across the UK, and allows them to invest in other parts of their business.
The properties are used to provide supported living for vulnerable adults with additional needs, including learning and physical disabilities, sensory impairment, mental health needs and survivors of domestic abuse and homelessness. The portfolio is underlet to Bespoke Supported Tenancies Ltd (“BeST”), a Housing Association specialising in Supported Living. BeST will provide, maintain and repair the properties, while an independent care provider will give specialist support to the underlying tenants.
The lease to Big Help has an insurance-backed guarantee from Ageas Insurance (A+ rated) which provides the secure income the Fund targets. The rent paid by Big Help is c.50% of the rent they receive from BeST. BeST receive income from Local Authorities (who receive from the Government) to cover the rental and running costs of the properties on behalf of its residents. This provides additional comfort on the rent paid to the Fund. These two factors make the transaction an attractive investment which provides 30 years of secure inflation-linked cashflows which the Fund is targeting.