The growth of professional, large scale investment into residential operational real estate in the UK has been one of the foremost trends across the whole real estate asset class since the Global Financial Crisis. Build to Rent (BtR), Purpose Built Student Accommodation and Retirement Living are the sub sectors that have attracted the most attention to date (UK Operational Real Estate: The Sky’s The Limit, Savills, 2019) but one of the biggest opportunities is just beginning to gather momentum: affordable housing. Affordable housing – the opportunity .

The affordable housing sector has the same favor able long term structural demand drivers, liability matching return characteristics, potential for growth and insulation from volatility that has drawn investors to other residential sub-sectors. It also offers the best opportunity for social impact and long-term investors are increasingly looking for ethical opportunities. Private finance has long played a vital role in the sector through debt finance, typically through bank debt and capital market funding from either public or private bond issuances. The bond market activity is financed by private capital for long term financial return and appetite to fund Private Registered Providers (PRPs) has been strong in recent years. So private money is not new in the sector but it is the recent equity investment activity from For-Profit Registered Providers (FPRPs) that represents a new opportunity and has become a hot topic in the industry and media.

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