Hugo Llewelyn: Our strategy aims to solve the shortage of capital available to improve and lease affordably the buildings and land critical for the dignified delivery of UK social infrastructure services.
Newcore Capital has achieved a first institutional close for the latest fund within its flagship value-add series, Newcore Strategic Situations VI (NSS VI).
The close includes equity commitments from a large local government pension scheme (LGPS) pool as well as a further direct LGPS scheme.
The closing means that NSS VI immediately has £150m of investment capacity to deploy across opportunities in UK social infrastructure in sectors including healthcare, education, childcare, transport, waste management, energy, and storage.
Newcore Capital said these sectors meet essential societal needs – adding that NSS VI investment will acquire and improve real estate, through planning, leasing and refurbishment, to enable the affordable provision of such services, supporting the ongoing needs of UK society.
NSS VI is a close-ended vehicle with a fixed life spanning seven years. The fund has an equity hard cap of £300m, targeting a final close by Q2 2027, and aims to deliver a net levered internal rate of return (IRR) to investors of 12-14% per annum, with a maximum leverage of 40% loan-to-value.
Newcore said it expects NSS VI to deliver significant positive social impact, alongside financial returns, given the fund will be taking planning, leasing and refurbishment risk to create and improve assets and this change can and will be measured and reported.
Newcore's value-add series has deployed a cumulative £275m into creating or improving UK social infrastructure in the last 24 months.
Newcore Capital chief executive Hugo Llewelyn said: "Our strategy aims to solve the shortage of capital available to improve and lease affordably the buildings and land critical for the dignified delivery of UK social infrastructure services.
"Our track record of strong, sustainable returns over the last 15 years and this successful first closing, supports our belief in the benefits of being a B Corporation. Our thesis is consistent: if you look after all your stakeholders in the capital management ecosystem in a responsible way, including the communities in which you work and the environment, you will do a lot better in the long-term for your investors and for yourselves. This has never been truer than in the current, volatile, geopolitical times."
