L&G raises £510m for affordable housing investment strategy

Written by Adam Cadle

03/02/2025

L&G has raised £510m for its affordable housing investment strategy as part of the second close of its Affordable Housing Fund, aimed at tackling the UK’s housing crisis head on.

New investors include London CIV, the entity that manages London Local Government Pension Scheme (LGPS) assets, which has invested £100m, alongside social impact investor Better Society Capital. In addition, ACCESS Pool, an LGPS collaboration of Central, Eastern and Southern Shires, has invested a further £20m in addition to a previous allocation in 2024.

Since launching its Affordable Housing Fund in July 2024, L&G’s investment strategy has attracted strong investor interest, demonstrating the attractive proposition that the asset class offers institutional investors seeking, inflation-linked returns alongside positive social impact.

The funds raised to date are expected to deliver approximately 3,500-4,000 homes. Alongside completing a second close of the fund, L&G is announcing that it has seeded the fund with a portfolio of 514 homes, and has exchanged contracts on three funding opportunities to bring forward more affordable housing development. With the current pipeline the fund expects to have over 1,000 homes either operational or under construction by Q2 2025.

Ali Farrell, fund manager at L&G, stated: “The level of interest we have seen in this fund since its inception last year is a testament to the attractive proposition that investors see in contributing to much-needed affordable housing in the UK, while seeking to invest in steady inflation-linked returns and positive social impact. I am pleased to welcome our new partners as we leverage our sector-leading platform to execute our strategy and deliver high quality housing in areas of acute need.”

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