Newcore makes funeralcare debut for latest fund
Investment manager Newcore Capital has bought seven properties for around £25m for its fifth social infrastructure fund, marking its expansion into the funeralcare subsector.
The Newcore Strategic Situations V fund bought properties located across Greater London and neighbouring commuter towns.
The fund said it has bought its first mortuary in Surrey, occupied by Dignity Funerals. It also acquired education and roadside properties, including four Fennies Day Nurseries locations and a Monkey Puzzle Day nursery in Beaconsfield, Buckinghamshire.
Investment manager Newcore Capital has bought seven properties for around £25m for its fifth social infrastructure fund, marking its expansion into the funeralcare subsector.
The Newcore Strategic Situations V fund bought properties located across Greater London and neighbouring commuter towns.
The fund said it has bought its first mortuary in Surrey, occupied by Dignity Funerals. It also acquired education and roadside properties, including four Fennies Day Nurseries locations and a Monkey Puzzle Day nursery in Beaconsfield, Buckinghamshire.
Newcore also purchased a school leased to special educational needs provider Outcomes First Group in Walton-on-Thames, Surrey, and two petrol filling stations in Crouch End, N8, and Streatham, SW16.
The fund said the funeralcare subsector was a “market segment marked by a mismatch between supply and demand, driven by the UK’s ageing population and a limited land supply for the specialist use”.
The acquisitions follow the final close of the same fund in May, which secured £190m in equity commitments from various investors, including two local government pension schemes.
Newcore Capital chief investment officer Harry Savory said: “Newcore is always looking for opportunity to invest in assets that provide essential services to society, and we are pleased to include funeralcare in our most recent acquisitions. It is a sector constrained by planning, which services a genuine societal need, particularly in locations with an ageing population.”
Savory added that Newcore seeks to deploy £350m for the fund over the next two years. Target asset classes include education and childcare, healthcare, storage, life sciences, waste management, roadside and transport.
Newcore’s acquisition strategy focuses on buying tired, short-leased or vacant properties and land ranging between £2m-£25m in lot sizes, in locations across the South East. The investment manager then works with tenants to deliver “future-proofed” social infrastructure.
Newcore Capital chief executive Hugo Llewelyn said: “We set up this business to find the next wave of alternative asset classes to emerge as the ‘new core’ – a key pillar in institutional investors’ portfolios – and this has taken us into new subsectors such as funeralcare and roadside real estate.
“Brexit, Covid-19 and the Ukraine war have all led to a focus on resilience – finding investments that will be immune to macroeconomic shocks and technological disruption – and we can think of nothing more resilient than assets that enable the provision of basic, essential services to society.”
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