London CIV allocated £150 million to support affordable housing initiatives in 2023

London CIV has made a £50 million investment into Octopus Affordable Housing Fund (“Octopus AHF”). The latest pledge results in a total commitment of £150 million in UK affordable housing by the LCIV UK Housing Fund in 2023, after the £100 million investment into CBRE UK Affordable Housing Fund (“CBRE UK AHF”) in May.

The investment from London CIV and other participants in Octopus AHF is anticipated to support the construction of over 500 affordable homes for families and older individuals in various regions across the UK. This marks the initial step toward Octopus AHF’s overarching objective of financing the development of 5,000 homes in the coming years.

London CIV introduced the LCIV UK Housing Fund in March 2023, with the aim of empowering its 32 partner funds (comprising all London boroughs and the City of London) to invest in the appealing attributes associated with affordable housing. These include income patterns usually aligned with inflation, low void rates, high occupancy rates, and a low correlation when compared to other areas of the real estate market.

London CIV’s recent venture into affordable housing marks its second investment within the last six months. In May, the LCIV UK Housing Fund pledged £100 million to CBRE UK AHF. This initiative seeks to provide affordable and sustainable housing in areas of demand for individuals who face challenges in affording rent or purchasing homes in the open market.

Dean Bowden, CEO at London CIV, commented: “Following extensive due diligence and negotiations on behalf of our partners funds, we are excited for LCIV UK Housing Fund to partner with Octopus Investments and be an anchor investor in Octopus AHF. Private capital has a vital role to play in the affordable housing sector, and we are confident that Octopus AHF will deliver robust long term returns for our partner funds, and through its impact framework accelerate the delivery of much needed new and quality affordable homes.”

Christopher Osborne, Senior Portfolio Manager at London CIV said: “We are delighted to have committed capital into Octopus AHF; this represents a compelling opportunity to partner with a “best in class” manager (Octopus) in the affordable housing space, under the stewardship of Ed Clough and Jack Burnham. We look forward to Octopus AHF driving resilient returns for our underlying Partner Funds and generating impact through increasing the supply of genuinely affordable and quality homes for some of the most vulnerable members of society.”