Home REIT sheds more than 100 more properties as it closes and races to pay off debts

Real estate investment trust Home REIT offloaded a further 101 properties in a series of auctions, raising £18.5m, on Thursday.

The latest sale represented 6.6 percent of the company’s portfolio by value.

The group is being dissolved amid considerable debts, the threat of legal action and an investigation by the financial regulator.

To date, the former FTSE 250-listed group has completed the sale of 987 properties and exchanged a further 315 properties.

On Friday, the group said: ‘Gross proceeds from properties sold and exchanged amount to £181.2m, which in aggregate is in line with the preliminary valuation of August 2023.’

In a notice to the stock exchange on July 16, the group’s board said a controlled winding-down of the business would be in the best interests of shareholders.

The announcement of a controlled liquidation came after the group failed to recoup its rental income and recover from a series of scandals over the past two years.

Home REIT was promoted as a way to house vulnerable people, including the homeless, by renting properties to charities and other groups, who would pay rents using government housing benefits.

The company went public in London in October 2020 and raised £850m in investors to build a portfolio of 12,000 beds.

The group was suspended from trading in January last year after failing to file its accounts on time.

The problems first surfaced more than 18 months ago, when short-seller Viceroy Research raised concerns about the sustainability of its business model. Viceroy questioned the group’s ability to collect rent from tenants.

In February, the Financial Conduct Authority opened an investigation covering the period from September 2020 to January last year, while law firm Harcus Parker also filed a lawsuit against the company, representing hundreds of shareholders.