Three new investment trusts prepare to launch

A handful of investment trusts are about to make their stock-market debut. 

Three investment companies are preparing to make their stock-market debut – a UK recovery fund, a green energy trust and a real estate investment trust (REIT).

The Tellworth British Recovery & Growth Trust (TBRGT) last week announced its plans to list on the stock exchange. It will seek to raise £100 million via an initial placing and an offer to intermediaries, although it has the flexibility to raise up to £500 million.

The aim of the “best of British” trust will be to deliver long-term returns over a rolling five-year period by investing in UK-listed companies with a significant presence in the UK. The concentrated portfolio will reflect the investment team’s highest conviction ideas across the market-cap spectrum, the group said.

At the helm of the trust will be Paul Marriage, John Warren and Johnnie Smith of Tellworth Investments, a specialist equity investment business established in 2017. It delivers investment management and advisory services through boutique firm BennBridge.

Marriage and Warren are former star managers at Cazenove Capital and Schroders where they ran UK smaller companies and long/short strategies including Schroder UK Dynamic Absolute Return and Schroder UK Dynamic Smaller Companies. After setting up their own firm in 2017, they launched the open-ended LF Tellworth UK Smaller Companies fund the following year, which has just under £300 million in assets.  

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Triple Point rolls out low-carbon trust

Elsewhere, clean energy-focused investment trust Triple Point Energy Efficiency Infrastructure Company is aiming to list on the specialist fund segment of the London Stock Exchange’s main market. It wants to raise £200 million through a 100p per share offer.

With an investment team led by head of energy Jonathan Parr and fund manager Charles Herriott, the trust will invest in a diversified portfolio of assets that have a positive environmental impact and help facilitate the transition to a low-carbon economy.

Triple Point says energy efficiency is a fast-growing sector, which plays a critical role in meeting the UK's target of reducing greenhouse gas emissions to net zero by 2050. The trust will look for those companies in the sector that have predictable, long-term cash flows and stable revenue streams.

It will target a total return of 7-8% a year, with a 5% dividend yield in its first financial year, and a “progressive dividend policy” after this time.

Triple Point is known for its social housing REIT, but also has a 10-year track record as an impact investor in the energy efficiency space, where it manages £1.5 billion of assets in energy and infrastructure.

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Home REIT announces intention to float

Finally, this morning (7 September) Alvarium Home REIT Advisors announced that it is seeking to raise £250 million for Home REIT. The company is seeking to contribute to the alleviation of homelessness in the UK by investing in a diversified portfolio of assets across the UK that will be dedicated to providing accommodation to the homeless.

The accommodation assets will be let or pre-let on very long (typically 20 to 30 years), inflation-linked leases to registered charities, housing associations, community interest companies and other regulated organisations that receive housing benefit or comparable funding from local or central government.

The company is targeting returns of at least 7.5% per annum over the medium term, with a minimum dividend of 5.5p per annum from the financial year starting 1 September 2021. The issue price is £1 per ordinary share.

Numis, the investment trust analyst, points out there are two other major trusts that target social housing assets: Civitas Social Housing (LSE:CSH) and Triple Point Social Housing (LSE:SOHO).