You are viewing 1 of your 1 free articles
Local Government Pension Scheme and Church of England commit £104m to housing fund
The Church of England and an investment pool managed by the Local Government Pension Scheme (LGPS) have committed £104m to a community housing fund.
The funding marks the first close of commitments into global investment firm Man Group’s Community Housing Fund (Man Coho 3).
The LGPS’ share of the investment comes from London CIV, an investment pool that exclusively serves the 32 London boroughs and the City of London.
This initial capital injection is expected to help enable more than 350 energy-efficient, affordable family homes (a mix of regulated and non-regulated tenures) to be built in areas of constrained affordability across the UK.
READ MORE
The investment is also the first step towards an initial capital raise of £300m, funding the delivery of 1,000 homes over the next few years.
London CIV was launched in March 2023 to invest in affordable housing, including income that typically tracks inflation, high occupancy, low void rates and low correlation compared with other real estate sectors.
In October 2024, another group of LGPS members appointed an investment manager to target returns linked to the decarbonisation of buildings.
This latest investment in affordable housing is the fifth since the fund was set up. As of 31 October 2024, it has £32.9bn in pooled assets.
Christopher Osborne, head of real estate at London CIV, said: “Following extensive due diligence and negotiations on behalf of our partners funds, we are delighted to have committed capital into Man CoHo 3. This represents a compelling opportunity to partner with a quality manager (Man Group) in the affordable housing space, under the stewardship of Shamez Alibhai and his team.”
The Church of England’s Social Impact Investment programme is managed by the Archbishops’ Council. It was established in 2020 to respond to the growing need for investment-based models to tackle deep-rooted social challenges in England, including the housing crisis and the need for a just energy transition towards net zero.
Vanessa Morphet, head of social impact investment at the Archbishops’ Council, said: “Man Group’s community housing team have set clear and ambitious targets for the fund including 90% affordable housing assets and significant improvements in the energy efficiency of homes.
“The team brings considerable expertise, a comprehensive impact assessment process and excellent relationships with local authorities and housing associations, and we look forward to what can be achieved to help address the significant need for new quality affordable homes.”
Recent research from the Pension Insurance Corporation (PIC) has found that consolidating local government pension funds could unlock £200bn in private investment in housing and infrastructure.
Chancellor Rachel Reeves previously announced that she plans to introduce a pensions bill that would see 86 local government pension schemes pooled into eight megafunds.
The PIC said that if pension schemes – currently valued at around £400bn – directly invested £55bn in equity in projects that need large injections of capital, this could crowd in an additional £165bn in private capital.
As yet, the local government pension schemes do not have the scale required to make this level of investment.
Sign up for our development and finance newsletter
Already have an account? Click here to manage your newsletters
