Inspired Villages secures investment from Legal & General and NatWest Pension Trustee Limited to deliver thousands of new net-zero carbon homes

UK, 26th July 2021: Award-winning later living developer and operator, Inspired Villages today unveils plans to significantly increase its portfolio of retirement villages, thanks to a £500m investment boost from Legal & General and NatWest Pension Trustee Limited, the defined benefit pension scheme of NatWest Group.

The deal supports Inspired Villages’ next stage of growth as it scales up its ambitions to build net zero carbon later living communities across the UK. The 15-year partnership will seek to grow Inspired Villages’ portfolio to 5,100 homes to meet the fast-growing need for specialist later living accommodation.

With an ageing society, we will soon have more people over 65 than under 18, but do not have the infrastructure, health-spend or social care to support this long-term demographic shift, exacerbated by a shortage of suitable later living options. There are now more than 12m over-65s in the UK with this figure expected to increase to nearly 18m by 2040. However, there are currently only 78,000 later living homes in this country and only around 7,000 new units delivered each year.  The UK later living sector lags significantly behind other markets, with only 0.6% of over-65s living in later living communities compared to around 5% to 6% in the US, New Zealand and Australia. 

Inspired Villages offers a wide range of housing options across six operational villages, both rentals and for sale – with sale prices starting from £230,000 – and ranging from 1-bedroom apartments to 3-bedroom houses, all set within vibrant communities carefully designed for the needs of older people and focused on promoting holistic wellbeing.  With a commitment to grow the portfolio to 34 sites, housing around 8,000 residents, the deal enables Inspired Villages to scale its impact in addressing the considerable shortage of appropriate housing for older people in the UK. 

Inspired Villages’ supports 919 residents in living healthier, independent lives for longer so that they can remain in their own home as they age, while being able to access necessary support and wellbeing services when needed. With a strong social purpose, it is driven by the desire to keep residents healthier and happier for longer and take the pressure off our already overstretched NHS and care services. 

Described by medical professionals as a “silent epidemic”, loneliness has profound medical implications. Even before the pandemic, more than two million people in England over the age of 75 lived alone and more than a million older people said they go for a month without speaking to a friend, neighbour, or family member. This social isolation, and loss of social support and services has been further exacerbated in the last 18 months. 

Later living communities, in contrast, have provided safer environments, offering residents the ability to self-isolate in their own homes while maintaining access to a network of support and social interaction not available to those who live alone in traditional housing. Facilities such as gyms and swimming pools have largely remained open to residents, under strict safety measures, such as single household booking, to promote physical wellbeing, with exercise classes also being led online.

The village teams have also organised socially distanced gatherings for coffee and wine on resident balconies and patios, arranged walks and socially distanced exercise classes in the spacious grounds of the villages, and made regular buddy calls. In addition, cooked meals from the village restaurants have been available to be delivered directly to residents.

Operating over long investment horizons and as responsible investors, Legal & General and NatWest Group Pension Fund are aligned in their desire to back investments that deliver a positive environmental and social impact.  Having committed to delivering all new housing stock as operationally net-zero carbon by 2030, Inspired Villages broke ground on its first two net-zero carbon in regulated energy developments earlier this year. Located in Bedfordshire and Hampshire, together they are bringing forward over 350 energy efficient homes –a first for the UK’s later living sector.  The central Bedfordshire site (Millfield Green), for example, will deliver renewable energy generation through on-site photovoltaics, EV-charging, improved building fabric and insultation, Mechanical Heat Vent Recovery units and ground-source heat pumps, provided by Kensa Group, a market leader backed by Legal & General.  These net zero carbon villages will give their residents long-term security over running costs whilst helping to combat climate change.

Jamie Bunce, CEO of Inspired Villages, said: “NatWest Group Pension Fund’s desire to co-invest is a fantastic testament to our company’s vision and hard work.  The deal will allow us to grow at pace so we can help thousands more over 65s enjoy healthy, independent living for longer and support our country’s overburdened health and social care system. NatWest Group Pension Fund is closely aligned with our sustainability goals, so partnering with them will allow us to continue to lead the sector, delivering net zero carbon later living communities which will make a real difference to the way we live and age in future.”

Phil Bayliss, Chairman of Inspired Villages, commented: “Covid has shone a light on the role that later living communities play in our society, further rocket-fuelling demand for high quality, aspirational later living accommodation.  Our new JV with NatWest Group Pension Fund is a tremendous validation of the growth of Inspired Villages as an operator of later living communities. Through this like-minded strategic partnership, we are able to scale our investment in this important emerging asset class, paving the way for further pension money to follow and increasing our societal impact.” 

Robert Waugh, CEO of NWPTL, commented: “The investment potential of the later living sector is substantial as the need to support our ageing population increases. This new partnership with Legal & General and Inspired Villages aligns perfectly with our ambitions to invest in areas that present strong social and environment credentials, whilst offering a good match for our long-dated liabilities. As Inspired Villages continues to mature and grow its portfolio, we are excited to be coming on board to support its expansion.”

Laura Mason, CEO of Legal & General Capital, said: “At Legal & General, we are determined to use society’s capital for society’s benefit. Net zero later living communities, which help to tackle climate change whilst addressing years of underinvestment in our ageing population, do just this. It is fantastic to be partnering with NatWest Group Pension Fund who are aligned in this purpose.  This transaction is unique as it sees one of the largest UK pension funds investing directly into UK private social infrastructure.  Broadening the range of growth assets that pension money can access is an important step forward for the UK’s growth agenda and economic future, allowing our country’s savings to support the UK in building back better, address climate change and tackle the major issues society is facing.  We hope to see further deals like this follow.”

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