London Stock Exchange welcomes the PRS REIT plc
The London Stock Exchange today welcomed The PRS REIT plc to trading on the Specialist Fund Segment of the Main Market.
Established by Sigma Capital Group plc, the AIM-quoted private rented sector and urban regeneration specialist, The PRS REIT has been created to invest in newly-constructed family homes for rent across cities and towns in England.
The PRS REIT is targeting a stabilised dividend yield of 6% or more per annum and net total shareholder returns of 10% or more per annum, once fully invested. The target dividend yield in the period to 30 June 2018 is 5%.
The PRS REIT breaks new ground in being the first quoted Real Estate Investment Trust to focus purely on the private rented sector (“PRS”) and has raised approx. £250m in an oversubscribed fundraising. Notably, the UK Government’s Homes and Communities Agency (“HCA”) is supporting the PRES REIT as a direct investor, with a direct investment of approx. £25m.
Sigma PRS Management Limited, a subsidiary of Sigma Capital Group plc, is Investor Advisor to The PRS REIT.
Graham Barnet, CEO of Sigma Capital Group plc and Sigma PRS Management Limited, the Investment Adviser to the Company, said:
"We are tremendously excited about prospects for The PRS REIT. There is an acute shortage of new rental homes across England and Sigma’s success in the private rented sector clearly demonstrates the unmet need for a high quality, professionally managed family homes in the English regions.
"The PRS REIT will be funding new rental homes which are aimed at 26-45 year olds earning within the UK’s average household income band. Currently, the average family that cannot afford to buy has little choice and is faced with the prospect of renting relatively poor quality or poorly managed homes. The new homes funded by The PRS REIT are intended to be the polar opposite of this – high quality homes, near good schools and transport links, offering security of tenure.
"We look forward to advising and managing the development of what we hope will be one of the largest PRS portfolios in the UK."
Steve Smith, Chairman of The PRS REIT, said:
"The launch of this PRS REIT breaks new ground, since it is the first REIT to focus purely on the private rented sector. We’re delighted to report that our target of £250m gross has been raised, with the fundraising significantly oversubscribed. Investors include some of the UK’s leading institutions as well as a strong base of qualifying private investors.
"Furthermore, the support of the Government’s Homes and Communities Agency as a cornerstone investor underlines our confidence in our approach, which is to establish investment-grade, professionally managed new family homes for rent at scale across the regions in England.
"We believe that The PRS REIT has the potential to deliver an attractive level of dividend income together with the prospect of capital growth."
Nplus1 Singer Advisory LLP acted as financial adviser and joint bookrunner, Stifel Nicolaus Europe Limited as joint bookrunner, Maclay, Murray & Spens LLP as legal counsel and KTZ Communications as financial PR.