The Real Lettings Property Fund2 (RLPF2), managed by social impact investment company Resonance and homelessness charity St Mungo’s, has received further investments of £15m each from the London Boroughs of Lambeth and Westminster. The Fund purchases homes around the capital for people affected by homelessness, helping them move on with their lives and into independent living.
The RLPF2 is the second fund from Resonance that is building a residential property portfolio in Greater London. There is a third Fund, the National Homelessness Property Fund, which purchases homes elsewhere across the UK. With this latest investment the Resonance homelessness funds under management have now grown to more than £190m providing almost 789 homes nationwide, housing thousands of people who are homeless or vulnerable to homelessness over the life of the Funds.
The RLPF2 was launched in January 2017, and follows the award winning original RLPF blueprint which enables local authorities to nominate individuals or households, who will receive support from Real Lettings, the social lettings agency run by St Mungo’s, to help them maintain their tenancies and move towards employment, stability and independence.
Investors into the property funds receive income generated from rents as well as capital from appreciation when the properties are sold (most likely to a follow-on social impact investment fund). Resonance buys properties as individual units rather than in blocks thus diversifying the portfolio, while investors’ risk is further reduced with Real Lettings acting as guarantors of rents. But the innovative focus of these Funds is on their social impact. So often, prospective tenants who have been homeless can feel barred from the private rented sector, whereas in this innovative model the expertise of St Mungo’s and Real Lettings allows them to evaluate a tenants’ readiness to progress towards independence and gives them that chance of establishing a tenancy.
Both Westminster and Lambeth have invested into the London property funds before and talk about why they have reinvested again.
Cllr Andrew Smith, Cabinet Member for Housing and Customer Services at Westminster City Council, said: “This funding guarantees a supply of high quality family housing, supported by St Mungo’s, for those who otherwise would have been in temporary accommodation for many years.
“The homes purchased with the funding are an excellent, and important, alternative for those having long waits for social housing. We recognise homelessness can result from a variety of complex circumstances such as family breakdown, domestic violence or loss of private sector tenancies, and a variety of housing solutions for homeless households are needed in Westminster.”
Cllr Paul Gadsby, Cabinet Member for Housing at Lambeth, said: “Housing homeless families in the borough is becoming ever harder because of rising demand. At Lambeth council we are determined to do what we can to tackle the local impacts of this London wide issue.
“This is why as part of that commitment we are investing a further £15million in the Real Lettings Property Fund. Our initial investment in the fund was successful in securing high quality homes for homeless families.
“We have prioritised this further investment because having a decent home is such an important and central factor in the health and wellbeing of all families.”
John Williams, Investment Director & Head of Property Funds at Resonance, welcomes the new investment: “We are always delighted and encouraged when we have returning investors, as we feel it is a great endorsement that this model is working well for both tenants and investors.”
Susan Fallis from St Mungo’s says: “The RLPF2 is addressing the very high cost, both financial and social, of rented accommodation in London. It is helping people stay within their local support networks, keeping their children in school and assisting them to move to securing longer term tenancies. This much welcomed further investment from Lambeth and Westminster will allow us to extend that impact to even more people who are vulnerable to homelessness.”