LaSalle Investment Management has provided €126.3m (£106m) loan facility to finance the development of two retirement villages in the South of England. The development loan has been extended from the LaSalle Residential Finance (LRF) programme to a recently formed joint venture between Audley Group and the UK Retirement Living Fund, which is managed by Schroders Real Estate, the investment manager, and Octopus Real Estate, the UK specialist real estate lender and investor.
The facility is secured against two luxury retirement villages to be developed by the joint venture and operated by Audley in Stanbridge Earls in Romsey, Hampshire, and Sunningdale Park in Sunningdale, Berkshire. Together the two villages will comprise over 250 for-sale residential units for over-65s and high-quality amenities. As demographic change drives increased demand for purpose-built retirement community real estate for the UK’s active adult population, the two schemes will address the significant undersupply within the affluent markets of Romsey and Sunningdale.
Daniel Pottorff, Managing Director of Debt Investments and Special Situations at LaSalle Investment Management, said: “We are delighted to have provided this financing solution to the joint venture which further strengthens our relationship with the Audley team, having extended a loan from the LRF programme to the Group in 2017 for an urban retirement scheme in Clapham, London. This investment exemplifies our strategy of investing in demographically compelling segments of the residential market.”
Amy Klein Aznar, Head of Debt Investments and Special Situations at LaSalle Investment Management, said: “We are excited to have further extended the LRF programme which continues to be backed by main investor APG. LRF focuses on bed-based investments and, in particular, on specific segments such as senior living and build to rent which remain structurally undersupplied. This is another example of our strategy of lending to market-leading sponsors to finance the development of best-in-class assets and marks the 15th debt investment completed on behalf of the LRF programme.”
Jon Austen, Chief Financial Officer at Audley Group, said: “We have a long-established track record of developing and operating retirement villages. Our JV structure with the UK Retirement Living Fund, managed by Schroders and Octopus Real Estate, allows us to execute our model in a less capital-intensive way while maintaining our first-class offering which the market continues to demand. We are pleased with the extension of this finance arrangement which reflects the strong growth in our sector.”