Residential Secure Income announces intention to float

Residential Secure Income has announced its intention to raise up to £300m as it floats on the London Stock Exchange.

The closed-ended investment company was targeting the fresh capital through a combination of a placing and an offer for subscription of ordinary shares.

Its intention was to convert into a residential investment trust; that is to say, a company which owns and operates income producing real estate assets.

"ReSI represents a highly scalable, long-term investment opportunity to generate secure, inflation-linked returns for shareholders with the potential for capital growth," said chairman Baroness Dean of Thornton le Fylde.

All proceeds from the issue would be invested into residential asset classes comprised of the stock of UK social housing providers, mainly housing associations and local authorities.

Management said they were targeting an inflation-linked dividend yield of 5% per year and a total return in excess of 8%.

This comes at a time whereby increasing demands to build homes in the UK alongside reduction of the new UK Government grant is pushing Housing Association to seek new avenues for funding.

The company also disclosed that it had appointed ReSI Capital Management to act as the alternative investment fund manager.

ReSI Capital Management had a 16-year track record in the sector, having advised and arranged funding to date for over £10bn-worth of projects in the social housing, care and other specialist residential property sectors.