Multifamily Housing REIT launching to consolidate the rental market


#1

Originally published at: https://whichinvestmenttrust.com/multifamily-housing-reit-launching-to-consolidate-the-rental-market/

The new trust is looking to fill the gap left by buy-to-let landlords abandoning the sector. West Country based Harwood Capital, is looking to raise £175 million from investors to launch the Multifamily Housing REIT, to invest in buying up existing invest in regional UK private rented sector housing. The new REIT will list on…


#2

Not sure I understand the fees here; looks like they’re charging 0.5% management fee plus they’re taking 6% of the rent. It what it states in the prospectus.

What could possibly be the justification for that???

There is no way I would invest in a trust paying 6.5% per annum to the manager.


#3

Yeah I’m with ya @citygirl No effing way would I subscribe to a fund paying 6.5% to the manager. This one is an easy miss for me.


#4

The fees are outrageous. I hope this trust fails to even launch.


#5

Their factsheet shows combined fees based upon NAV and rental income being in the region of 1%. From the prospectus and the article, the gross rental income of the seed portfolio is around 7% - and they will be taking 6% of that, i.e. the equivalent of 0.42% of NAV. Add to this the 0.5% fee based upon NAV and the result is 0.92%. (Only a guide - the actual figures will depend upon net rental income achieved, and there might be additional costs to be charged, such as independent valuer’s fees - I haven’t checked the prospectus for what it says about any additional charges)

[To get total fees of 6.5% they would have to take just under 86% of the net income. That, or they achieve a rental income of 100% of assets!]


#6

It is a little confusingly worded, for me at least but thanks for clearing that up @arkwelder :grinning:


#7

I’m sure Chris Mills won’t be knocking on doors asking for rent :joy:. Not for me but I wonder who’s going to run it.


#8

Who is Chris Mills @james_pigott ?


#9

He’s the fund manager @andytheinvestor. He also runs North Atlantic Smaller Cos which is very good. He’s chair of Harwood Capital, hard to get hold of and does not subscribe to the AIC so info is also hard to get. Market thinks he’s a little arrogant!