Consistent with its investment objective, it will aim to identify properties which are expected to achieve rental yields and long-term house price growth at an average or above average level for the region. In researching properties and the associated risk, the Investment Adviser will consider factors such as location, property type, demand indicators, and physical and environmental factors.
The Company will acquire both houses and flats, which will be both new build and existing properties. Where appropriate, discounts will be sought on purchases that mitigate or eliminate the transactional costs of investment or provide an element of additional performance.
The Company will maintain a let Investment Portfolio, but it will not aim to reflect the London housing market at large, including geographic mix. The Company will specifically avoid exposure to prime property and rural areas. Attention will also be given to maintain appropriate diversification and a prudent spread of risk at all times. Initially the Company intends to focus investment in London, and this may extend to areas commutable to London in the future.
Properties will generally be let on an assured shorthold tenancy (“AST”) basis. Where opportunities arise and fit with the Company’s investment objective, units may be let on a ‘part sale, part rent’ basis, or let to specialist operators for use as serviced apartments, or units obtained from residential developers on a sale and leaseback basis. Properties subject to non-AST leases will be managed to ensure that the Company is not unduly exposed to counterparty or liquidity risk.