Asset allocation

The Company will pursue its investment objective by acquiring Buy-to-Let Portfolios throughout the UK.

The Company will acquire a mix of residential properties, albeit that on occasion this may include a related commercial unit. Accordingly it is unlikely that the acquired properties will be newly built.

The Company shall source the acquisition of Buy-to-Let Portfolios by an active marketing and PR campaign as well as through contacts with other professional advisers including solicitors and accountants.

Investment restrictions

The Group’s Property Portfolio will be managed with the objective of delivering a high quality, diversified portfolio through the following investment restrictions:

  • the Group will only invest in buy-to-let houses and apartments located in the UK (predominantly in England and Wales) and on occasion such properties may include commercial properties;
  • from Admission, and save as regards the properties at (i) 19 Iverna Court, Wrights Lane, London, W8 6TY (ii) 8 Hogarth Road, London, SW5 0PT (which is a mix of residential and commercial units) and (iii) 44 Alverstone Avenue, London, SW19 8BQ, no investment by the Group in any single individual house or apartment shall exceed 10 per cent of aggregate value of the total assets of the Group at the time of commitment; and
  • the Group will not invest in other alternative investment funds or closed-end investment companies.

REIT status

The Company will at all times conduct its affairs so as to enable it to remain qualified as a REIT for the purposes of Part 12 of the Corporation Tax Act 2010 (and the regulations made thereunder).

Gearing

The Group will seek to use gearing to enhance equity returns. The level of borrowing will be on a prudent basis for the asset class, whilst maintaining flexibility in the underlying security requirements and the structure of both the Property Portfolio and the Group. The Group may raise debt from banks but so that the Group will always be subject to an absolute maximum, calculated at the time of drawdown of the relevant borrowings, of not more than 65 per cent of the Gross Asset Value although over time the Group will aim for a maximum gearing level of 40 per cent. Debt will be secured at asset level and by way of debentures but without recourse to the Company depending on the optimal structure for the Group and having consideration to key metrics including lender diversity, cost of debt, debt type and maturity profiles.

Derivatives

The Group may utilise derivatives for efficient portfolio management. In particular, the Company may engage in full or partial interest rate hedging or otherwise seek to mitigate the risk of interest rate increases on borrowings incurred in accordance with the gearing limits as part of the management of the Property Portfolio.