Private-equity backed AHTO Group plans £1bn investment in rent to buy homes
A new company set up by a private equity investment firm has announced plans to invest £1bn in intermediate rent-to-buy housing over the next five years.
Affordable Homes to Own (AHTO), which is owned by Maddox Capital Partners - a subsidiary of global private investment firm JRJ Group - has announced plans to purchase thousands of homes in developments from housing associations and private house builders.
AHTO, with the support of finance arranger Citi UK, will look to acquire planned and existing homes using £1bn of secured institutional capital. It will seek to buy homes in section 106 allocations or private sale homes and then lease them to housing association partners.
Tenants will be given the opportunity to purchase their home for a 10% discount under an intermediate rent-to-buy model.
AHTO will focus on investments of up to £150m per project in developments of up to 500 homes, primarily focused on cities and commuter towns.
An AHTO spokesperson said the model would “free up housing association capital”.
Sam Senchal, Chief Investment Officer of AHTO says: “The only viable solution to the UK’s affordable housing crisis, without grant funding or subsidies, is to channel institutional investment into the market.
“The Intermediate Rent-to-Buy model brings together our partners and institutional investors to deliver more affordable homes for families with less complexity and cost compared with current affordable home models.
AHTO was set up last year and is wholly owned by Maddox Capital Partners, a subsidiary of JRJ. Maddox Capital Partners describes itself as a “provider of asset-backed asset liability management solutions to pension funds and the life insurance industry”.