Audley Group has raised nearly £40m in a sale-and-leaseback deal with an unnamed investor.
The retirement living provider has sold the freehold of five operational Audley Villages across the UK and will enter into a 50-year lease on the five sites, providing secure inflation-linked income to the investor.
The company will retain operational management of the villages and at the end of the 50 years, Audley Group will purchase the villages back for £1.
Nick Sanderson, founder and chief executive of Audley Group, said: “Investors are waking up to the opportunity in the retirement living sector and recognising the robust nature of the underlying income. Innovative funding structures, like the one announced today, showcase the opportunity and flexibility the sector can offer.
“Owners purchase their properties on a 125- or 250-year lease and, in return for the services and amenities offered, pay both monthly and deferred charges that deliver secure inflation-linked income which allows for highly predictable rent to flow to our new investors. The income protected as it is by the leasehold structures created offers a degree of inflationary income protection few other asset classes can offer.
“The attention on the sector is growing as its ability to alleviate challenges in both the housing and care sectors as our population continues to age become more widely acknowledged. Increasing supply is critical to help a greater number of people live long and healthy lives, while aligning with increasing institutional appetite. We look forward to continuing to realise this ambition with forward thinking investors that understand the importance of funding solutions that will in turn unlock future development.”
