AEW, the investment manager to beleaguered social housing trust Home REIT, has said in its latest portfolio update that rent collections from tenants will “vary month on month in the near term” as it continues to “work on stabilising the portfolio and taking legal action” against non-paying tenants.
The update, published today (4 April), confirmed that AEW is continuing to bring legal proceedings against non-paying tenants – a step that was first announced last month – as well as negotiating the restructuring of various leases. However, the investment manager is able to comment further at this stage.
Rent collected on operating leases during March – including arrears – amounted to 8% of the total rent invoiced during the month. AEW said an additional 4% – or £100,000 – was transferred before the end of March but “did not clear until 2 April”, and will therefore be reported next month.
See also: Home Reit sells 63 more properties for £6.1m
Two days ago, AEW signed new five-year leases across eight properties, managed by a provider of accommodation and support services working primarily to prevent homelessness. The company supports more than 5,000 vulnerable people each night on average through partnering with approximately 100 firms.
Elsewhere, AEW said it is continuing “active dialogue” with other providers of supported living and other social housing, who have “significant demand” for such properties. The housing was previously leased to Serenity Support CIC, which has been in liquidation since June last year.
It said: “AEW continues undertaking a comprehensive onboarding process for these new providers and property managers which involves qualitative and quantitative assessments including desktop and physical assessments of their operations and existing stock.”
According to AIC data, Home REIT is currently trading on a discount to NAV of 70.1%.
See also: AEW Europe CEO Wilkinson: Why we took on beleaguered Home Reit
At the start of the year, the chair of the trust’s board Lynne Fennah stepped down with the rest of the board to follow, due to widespread calls from shareholders for them to quit following various governance, communication and valuation scandals.
