Update on Acquisitions and Trading

8 June 2020

Triple Point Social Housing REIT plc

(the "Company" or, together with its subsidiaries, the "Group")

UPDATE ON ACQUISITIONS AND TRADING

The Board of Triple Point Social Housing REIT plc (ticker: SOHO) is pleased to announce the following updates:

 

·    The Group completed the acquisition of a further seven properties (comprising 40 individual units) for an aggregate consideration of approximately £7.6 million (excluding acquisition costs)

 

·     As at 5 June 2020, 100% of rent due for April 2020 was received and 95% of the rent due for May 2020 had also been received, with the balance expected to be received within the next two weeks

 

·    Jones Lang LaSalle, has advised the Company that it is removing the material uncertainty clause in its valuations, reflecting the continued timely receipt of rents in line with pre-COVID 19 levels and the level of activity within the specialised supported housing sector

 

·    The Company now has a look-through dividend cover of 95%, as measured on an EPRA earnings run-rate basis¹, and a strong pipeline of further investment opportunities to deploy its remaining available funds

 

Acquisitions Update

 

The Group has completed the acquisition of seven supported housing properties, comprising 40 individual units in total, for an aggregate consideration of approximately £7.6 million (excluding acquisition costs). The properties are located in the North West (7 units), Yorkshire (11 units), the East (5 units), London and the South East (8 units) and the South West (9 units).

 

The Group has entered into new FRI leases in respect of each of the properties acquired for periods of between 20 and 25 years. These leases are with specialist housing associations regulated by the Regulator of Social Housing, including Blue Square Residential, Falcon Housing Association, Inclusion Housing and Parasol Homes.

 

The rents received under these leases are subject to annual, upward-only rent reviews, increasing in line with the Consumer Price Index.

 

The properties comprise specialist, high quality homes for individuals with mental health and other support and care needs.

 

The properties generate net initial yields in line with the Company's existing portfolio.

 

Rental Collection and Dividend Cover

 

The Group continues to receive rents on a timely basis and in line with both expectations and the experience in prior years. As at 5 June 2020, 100% of rent due for April 2020 was received and 95% of rent due for May 2020 had also been received, with the balance expected to be received within the next two weeks.

 

With the inflation-linked rental increases agreed in April (announced on 14 April 2020) underpinned by consistent receipt of rents, completion of developments and acquisitions since the beginning of the year, including those announced today, and accounting for income on exchanged and forward funded properties, the Company now has a look-through dividend cover of 95% as measured on an EPRA earnings run-rate basis¹.

 

Removal of Material Uncertainty Clause

 

On 2 June 2020, RICS published revised guidance for the use of material uncertainty clauses for valuations of specialised supported housing. The Group's independent valuer, Jones Lang LaSalle Limited, no longer considers that there is material uncertainty when valuing specialised supported housing of all types on the basis of Market Value. The removal of the material uncertainty clause reflects the continued timely receipt of rents in line with pre-COVID 19 levels and the level of activity within the sector which remains consistent.

 

Note:

1    Including revenue from operational and exchanged and forward funded properties

 

 

FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT:

Triple Point Investment Management LLP (Delegated Investment Manager)	Tel: 020 7201 8976
James Cranmer
Ben Beaton
Max Shenkman
Justin Hubble
Akur Capital (Joint Financial Adviser)	Tel: 020 7493 3631
Tom Frost
Anthony Richardson
Siobhan Sergeant
Stifel (Corporate Broker and Joint Financial Adviser)	Tel: 020 7710 7600
Mark Young
Mark Bloomfield
Rajpal Padam

 

The Company's LEI is 213800BERVBS2HFTBC58.

 

Further information on the Company can be found on its website at www.triplepointreit.com.

 

NOTES:

The Company invests in primarily newly developed social housing assets in the UK, with a particular focus on supported housing. The assets within the portfolio are subject to inflation-adjusted, long-term (typically from 20 years to 30 years), Fully Repairing and Insuring ("FRI") leases with Approved Providers (being Housing Associations, Local Authorities or other regulated organisations in receipt of direct payment from local government). The portfolio comprises investments into properties which are already subject to an FRI lease with an Approved Provider, as well as forward funding of pre-let developments but does not include any direct development or speculative development.

 

There is increasing political and financial pressure on Housing Associations to increase their housing delivery and this is creating opportunities for private sector investors to participate in the market. The Group's ability to provide forward financing for new developments not only enables the Company to secure fit for purpose, modern assets for its portfolio but also addresses the chronic undersupply of suitable supported housing properties in the UK at sustainable rents as well as delivering returns to investors.

 

Triple Point Investment Management LLP (part of the Triple Point Group) is responsible for management of the Group's portfolio (with such functions having been delegated to it by Langham Hall Fund Management LLP, the Company's alternative investment fund manager).

 

The Company was admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange on 8 August 2017 and was admitted to the premium segment of the Official List of the Financial Conduct Authority and migrated to trading on the premium segment of the Main Market on 27 March 2018. The Company operates as a UK Real Estate Investment Trust ("REIT") and is a constituent of the FTSE EPRA/NAREIT index.