LGPS and Church of England invest combined £104m in affordable housing fund

The initial capital invested is expected to support the delivery of more than 350 energy-efficient affordable family homes to be built in areas of constrained affordability across the UK. It is the first step towards an initial capital raise of £300m, funding the delivery of 1,000 homes over the next few years.

The fund, which develops housing stock that is predominantly leased to UK councils and housing associations, is managed by Shamez Alibhai, head of community housing and managing director at investment management firm Man Group.

Man Group launched its first ‘CoHO’ fund in April 2021, with the target of raising £400m to build 3,500 new affordable homes by 2026.

This latest investment in affordable housing by LCIV UK Housing Fund is its fifth since it was launched in March 2023.

As of 31 October 2024, London CIV, the LGPS investment pool that serves 32 Local Government Pension Schemes, had £32.9bn in pooled assets, including £18.4bn assets under active management and £14.5bn in passive fund assets.

Christopher Osborne, head of real estate at London CIV, said: “Following extensive due diligence and negotiations on behalf of our partners’ funds, we are delighted to have committed capital into Man CoHo 3; this represents a compelling opportunity to partner with a quality manager (Man Group) in the affordable housing space, under the stewardship of Shamez Alibhai and his team.

“We look forward to Man CoHo 3 driving returns for our underlying partner funds and through its impact framework, accelerating the delivery of much-needed new and quality affordable homes in the UK.”

The Church of England’s Social Impact Investment Programme, which is managed by the Archbishops’ Council, was established in 2020 to respond to the growing need for investment-based models to tackle deep-rooted social challenges in England. This includes the housing crisis and the need for a just energy transition towards net zero.

Vanessa Morphet, head of social impact investment at the Archbishops’ Council, said: “Too many families are vulnerable to the UK’s housing crisis and are priced out of decent, stable homes in the communities where they want to live and work.

“Man Group’s community housing team have set clear and ambitious targets for the fund including 90 per cent affordable housing assets and significant improvements in the energy efficiency of homes.

“The team bring considerable expertise, a comprehensive impact assessment process, and excellent relationships with local authorities and housing associations, and we look forward to what can be achieved to help address the significant need for new quality affordable homes.”