The fund will purchase freehold residential properties in “desirable” postcodes throughout the UK.
Castel said the increasing demand for assisted living and 22-year leases underwritten by local authorities will ensure that the fund provides potential long-term capital gains, with inflation-protected income.
The fund will aim to achieve 8% capital return a year, and has a minimum investment of £10,000 plus £5,000 additional subscriptions.
Stewart Quayle from AVI Fund Solutions, the principal distributor of the fund, said the approval forms part of the company’s continuing expansion in Asia.
“The residential assisted living property sector changed dramatically in 2011 when Southern Cross collapsed into administration and transformed the market through a change in legislation,” he said.
“The sector had to adapt quickly as it had opened up in terms of the properties and assets available for acquisition, and the ownership and investment structure in the market had also changed.
“Local authorities have a significant demand for purpose-built properties of which there is currently an undersupply, creating an attractive investment opportunity and an emerging asset class.”
In September, John Greenwood, chief executive at Creechurch Capital, said that, while the assisted living market is currently immature and has no scale, it will eventually “be talked about in the same breath as property investments such as student accommodation”.
He added that the funds are less likely to be at risk of suspension than other property investments, such as the Brandeaux Student Accommodation funds, because they have an increased liquidity.
