Embattled Home REIT set to appoint investment adviser this week as field narrows to two
Scandal-stricken social housing investor Home REIT is set to appoint a new investment manager this week as the field of potential suitors narrows to two, City PM has learned.
The former FTSE 250 firm has been interviewing firms to take on the role of investment manager after parting ways with adviser Alvarium amid a breakdown in the firm’s property portfolio and tenant base.
Under Alvarium’s management, just 23 per cent of Home REIT’s tenants paid rent to the firm while its portfolio was revealed earlier this year to require some £15m-£20m to refurbish.
Bosses at Home REIT are now set to appoint a new investment manager this week, with London-based firm Atrato and global real estate investment manager AEW the two firms still in the running, a source close to the discussions told City PM
The appointment could trigger a period of rapid overhaul for Home REIT as the new investment manager looks to restore its rental take and refurbish its dilapidated portfolio.
“Things are going to move very quickly as soon as [the new investment adviser] steps in,” said the source. “From day one, they will start doing some very radical things.”
Atrato has emerged as the front-runner in the race to take over management of the firm’s portfolio after it first launched the process in mid-March. Atrato currently manages the £1.1bn Supermarket Income REIT and announced plans in September to float a social housing REIT before abandoning the plans due to “market conditions”.
AEW is a US-headquartered asset manager with some £87bn assets under management and a dedicated REIT team based in the UK.
The new investment manager appointment is likely to bring an end to any sale process for Home REIT after it received a take-private bid from investment firm Bluestar Advisors. In mid-March, the firm said it had begun exploring “all its options for the ongoing management of the company’s assets” as an alternative to a sale and had begun to “consider candidates to act as investment adviser”.
Home REIT, Atrato and AEW were contacted for comment.