International Public Partnerships invests in US military housing

International Public Partnerships, the FTSE 250 infrastructure fund managed by Amber Infrastructure, has invested $32m (£25m) in the US military housing sector, which offers a secure revenue stream and no residual value exposure.

The company has invested the funds into interest-bearing subordinated debt instruments in the sector, which is the longest-established sector in the US for public private partnership projects (PPP), and is also looking to buy interests in the underlying assets as well.

The interests are underpinned by a 39-year debt security over seven operational PPP military housing projects, which encompass 19 operational military bases in the US, with approximately 21,800 individual housing units.

"The opportunity meets INPP's investment criteria and the company expects the instruments to offer INPP an attractive rate of return notwithstanding the weaker USD/GBP exchange rate," the company said.

"The investment provides the company with further exposure to one of the US infrastructure market's most established sectors."

Military housing investments offer a secure revenue stream, high barriers to entry as the number of on-base housing units is limited, no residual value exposure and a geographically diverse portfolio of housing units across the continental US and overseas.