Global investment giants Man Group today announced its intention to raise £400m for a new community housing fund, having already received £20m from Homes England, the first time the QUANGO has committed to an agreement of this type.

Man Global Private Markets’ first foray into the affordable housing market has attracted investments from the likes of Big Society Capital, the Schroder BSC Social Impact Trust and both the Swansea and Strathclyde Local Government Pension Schemes.

The fund has already begun deploying capital in the UK. To date it has committed to 363 new homes in England, with a target of 3,500 homes by 2026.

Shamez Alibhai, Head of Community Housing and Portfolio Manager at Man GPM, said: “This is an exciting milestone for our Community Housing strategy. With a shortage of quality affordable housing in the UK, we can help address this serious issue in a socially and environmentally sustainable way.

“Increasing the amount of socially responsible capital in the affordable housing space is good for communities and the people who live and work locally, but also for investors who are committed to achieving demonstrable returns and creating positive social and environmental change. We are pleased to be working with all our partners to deliver high quality homes to those who need them.”

In December 2020, the Man GPM team announced its first transaction, having agreed a £31m deal with leading modular housing company ilke Homes, for a 14.6-acre site in Grantham that has detailed planning consent for 227 homes. This was shortly followed by news of a £12m investment in a portfolio of 41 homes to be delivered in Lewes, East Sussex. And last month it announced the acquisition of 95 homes from Crest Nicholson at Alconbury Weald.

Man Group has invested £10m of its own capital as part of its commitment to the fund, in addition to warehousing the first three investments which will be transferred to it. Building the investment pipeline in advance of the first close has increased the speed of deployment – the advanced pipeline is currently comprised of 12 investments across a broad geographic spread, in some of the least affordable parts of the country, and totals more than 2,000 new homes.

Jeremy Rogers, Chief Investment Officer, Big Society Capital, said: “We are pleased to partner with the Man GPM team on investments from both the Schroder BSC Social Impact Trust and Big Society Capital. Alongside substantial experience delivering high quality and affordable housing in the UK, Man has demonstrated a deep understanding of the needs of its frontline partners and customers.

“The Man GPM team have established a best-in-class impact management approach; implementing measures to ensure that they deliver and are accountable for their social and environmental impact at every stage of the investment process. The fund will target areas of significant housing need alongside generating resilient inflation linked returns for investors.”

The fund will be marketed for a further 15 months or until capacity is reached and to underpin its commitment, the fund works with two third-party organisations, New Philanthropy Capital (NPC), the charity think tank and consultancy focused on social impact, and the Centre for Regional Economic and Social Research (CRESR), a leading UK policy research centre. Both organisations provide independent assessment of delivery against impact goals on behalf of the fund’s investors.