Legal & General has entered into a 15-year joint venture partnership with NatWest Pension Trustee Limited (NWPTL), the defined benefit pension scheme of NatWest Group, to invest £500m of equity in building later living communities which will be developed and operated by Inspired Villages.
The UK will soon have more people over 65 than under 18, but does 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 currently more than 12m over-65s in the UK with this figure expected to increase by 41 per cent to nearly 18m by 2040. 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 international comparisons, accounting for only 0.6 per cent of over-65s living in later living communities in contrast to around five to six per cent in the US, New Zealand and Australia.
Inspired Villages offers a range of housing options set within communities designed for the needs of older people and focused on promoting an active lifestyle. It aims to support the over-65s to live healthy, independent lives for longer so that they can remain in their own home as they age, while being able to access necessary care and wellbeing services.
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.”
Laura Mason, CEO of Legal & General Capital, added: “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.
“This transaction is unique as it sees one of the largest UK pension funds investing directly into UK private social infrastructure 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.”
Image credit: Inspired Villages.