Triple Point Social Housing REIT and Civitas slipped lower after the government issued an enforcement action against Auckland Home Solutions, a social housing tenant of both trusts.
The trust said that it has 30 assets leased to Auckland, worth £30.8mln at the end of last year or 4.6% of the group's portfolio value and accounting for 4.6% of the rent roll.
Auckland Home, which has 1,000 supported housing sites, was put on regulatory notice in 2021 and the Regulator of Social Housing. (RSH) said this ramping up of action reflects a lack of confidence that the home operator is compliant with its standards.
The RSH has ordered an independent review of Auckland’s operations and appointed three new board members.
Triple Point Investment Management, the REIT’s investment manager, said it had an established relationship with Auckland adding that the home operator had been working towards addressing the matters raised by the regulator in August 2021,
On 31 March, £41,064 of Auckland’s rent was outstanding said Triple Point, with this expected to be settled shortly.
Civitas later added it too had exposure to Auckland Home, with the tenant accounting for 15.9% of the annual contracted rent roll as of 30 September 2022.
In the statement it said; "The company published a detailed Trading Update on 30 January 2023 which noted the expectation that the growth in rental income and collections that had been achieved to 31 December 2022 would continue into 2023.
"The company is pleased to note that this has remained the case for the balance of the financial year to 31 March 2023."
Shares fell the Triple Point 2.4% to 49,8p while Civitas fell 4.2% to 57p.
-- adds Civitas comment--