Octopus raises £150m for affordable housing fund

Octopus Investments has topped up its affordable housing fund by £150m through local government pension scheme investors. Avon and Gloucestershire have each committed £50m, while Devon contributed £40m and Clwyd added £10m. Octopus’ fund offers a model that has specific benefits for the local government pension scheme investors looking to meet their environmental targets as well as delivering societal change by providing housing in their local areas. The latest fundraising round follows the first close of the fund in December 2023, with a £50m raise from London CIV, the investment pool for 32 of London’s local government pension schemes, and an additional £10m from social impact investor Better Society Capital. The capital raised last year has now been fully allocated to affordable housing projects with Octopus’ registered social housing provider NewArch Homes. This includes the acquisition of 180 affordable homes in May this year from Maidstone-based Golding Homes. Jack Burnham, head of affordable housing at Octopus, said: “We know there are a number of locally interested investors who are looking for opportunities to deploy capital into funds that can provide specific social impact to their local areas. We think this is an approach that should be embraced and are thrilled to be working with Avon, Gloucestershire, Devon and Clwyd pension funds to help support them either deliver affordable homes in their areas, or in other areas across the UK.” Shaun Stephenson-McGall, chair of Avon Pension Fund investment panel, said: “We invest £50m in affordable housing. This is broadly the equivalent of 250 new homes being built for up to 1,000 people. Critically, at least 20% will be in the Avon region. “We have worked alongside Devon and Gloucestershire pension funds to get this investment over the line.” Phil Latham, head of Clwyd Pension Fund, said: “This collaboration matches our ambition of driving positive societal and environmental impact in the UK, while also fulfilling our fiduciary duty of achieving sustainable investment returns.”