Home REIT: Beleaguered trust targets lifting of trading ban

Home REIT has laid out its plan to apply to the Financial Conduct Authority to restore the trading of its shares, as the beleaguered trust’s chair admitted facing “very significant challenges”.

The trust was launched with the intention of providing social housing to the homeless, but has been pummelled with multiple scandals over the last two years.

Today, Home REIT said its 2022 audited results are now expected to be published by mid-September, after the failure to submit it led to trading being suspended for the trust in January 2023.

Meanwhile, its 2023 audited results will be published in the last three months of the year, along with interim results for the six months to February 2023 and 2024.

“Upon publication of the results for all these periods, application will be made to the FCA for the restoration of trading of the ordinary shares,” said Michael O’Donnell, chair of Home REIT.

The former FTSE 250 firm has also appointed JLL and Allsop as agents to manage its £341m property sell-off.

O’Donnell admitted that Home REIT had faced “very significant challenges as a result of the failing of its former advisers” Alvarium, such as the poor condition of its properties, houses being rented privately rather than as social housing, tenants not paying rent or going bankrupt, and “significant mismanagement of properties by non-performing tenants”.

Another key challenge was “connections between tenants (and connections between tenants and vendors) that were not disclosed to the board”, he added.

Home REIT has been plagued with accusations and revelations over conflicts of interest faced by the firm, with the FCA opening an investigation into the firm in January. 

City A.M. then revealed in February that officials from the Serious Fraud Office have also opened inquiries into the company. The SFO has said it cannot confirm or deny investigations.

Now, with the firm facing significant debts, it announced last month it had no choice but to pursue a managed wind-down, selling off properties in an attempt to pay back investors and debts.

Home REIT is £106m in debt to Scottish Widows, though this has been reduced from £220m in August 2023, and is expected to be reduced by £34m more thanks to ongoing property sales.

Debts include £7.3m in unpaid borrowing fees charged since August 2023, along with around £5m in legal fees spent due to “threatened litigation from current and past shareholders“, O’Donnell said.

Shareholders will vote on the proposals to wind down and pursue property sales at a general meeting on 16 September.