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Hearthstone grows property fund

Sam Cordon

February 6, 2013

The specialist residential property fund manager will acquire 34 tenanted residential properties in the Quadrant Court development which will be leased back to Quintain for an initial fixed period providing certainty of income for the fund.

Christopher Down, founder and chief executive of Hearthstone, said: “The properties at Wembley will provide part of our fund’s property weighting for London as well as a strong and stable rental income. The completion of the transaction also highlights the growing industry confidence in the UK’s first FSA authorised residential Property Authorised Investment Fund, launched by Hearthstone late last year.”

Approximately £1.5m of the purchase price will be cash consideration with the remainder delivered via redeemable units in the Hearthstone fund.

The deal with Quintain, marks the third deal with a major developer or UK house builder since the launch of the TM Hearthstone UK Residential Property Fund in July 2012, following agreements with Barratts and Bovis.

The fund intends to acquire further assets in London, which constitutes approximately 25% of the fund’s overall allocation to residential property, and the fund’s focus on family housing should ensure a boost in the supply of rented accommodation within the capital.

Down said part of Hearthstone’s goal is to change the way the UK invests in property.

He said: “Professionally managed, FSA regulated funds like ours will be crucial in channelling mainstream investment toward housing whether that be from individuals looking to put residential property in their ISA or SIPP or institutional pension funds seeking stable, long-term returns from an asset class with historically low volatility.”

Richard Stearn, finance director of Quintain, said: “Quintain is delighted with the confidence this transaction demonstrates in the Wembley scheme where rental prices are an average of 20% above equivalent properties in the surrounding area.

“The Company is pleased to support the development of the professional private rental sector while continuing to reduce net debt in line with our stated strategy.”


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