Fund manager hoping to ride to rescue of troubled Home REIT receives backing of several major investors
A fund manager hoping to ride to the rescue of troubled Home REIT has received the backing of several major investors.
Edinburgh-based RM Funds sent out a proposal dubbed ‘Project Casa’ in late February to try to convince shareholders that it could take over as investment adviser for the sheltered housing group.
The previous adviser, Alvarium, cut ties with Home REIT as it became embroiled in a series of escalating crises.
Troubled: RM Funds sent out a proposal dubbed ‘Project Casa’ to try to convince shareholders that it could take over as investment adviser for the sheltered housing group
In a draft proposal to shareholders, seen by the Mail, RM has offered an ‘immediate reduction’ in advisory fees, while also promising to reinvest a percentage of these into buying shares.
RM said it wants to preserve the company’s ‘social objectives’ of providing accommodation to vulnerable people – the promise made initially by Home REIT’s founders Gareth Jones and Jamie Beale, fund managers at Alvarium.
The proposal has been submitted to the landlord’s board. The company announced on Wednesday that it was in talks with several investment adviser candidates.
RM’s offer has secured the support of over a third of the group’s shareholders, including several top investors.
A source close to the matter said if the board did not take up RM’s proposal, the risk of a ‘fire sale’ of Home REIT’s portfolio would increase, meaning many vulnerable residents would need to be relocated.
They added that a bid for Home REIT tabled by investment firm Blue Star Capital, whose director Benoit Gotlieb has links to Alvarium, was ‘not helpful’ as it restricted information at a time when transparency was critical.