More than 800 investors are suing the London-listed social housing company Home REIT, alleging they were misled about the security of its rental income, its financial strength and its stated social impact.
The £120 million-plus lawsuit was lodged at London's High Court on October 1 by law firm Harcus Parker. Partner Nate Barber said the company had been presented to investors as offering financial returns while helping to tackle homelessness, adding that the case was that what investors were told did not reflect reality. Home REIT declined to comment beyond saying a further announcement would be made at the appropriate time.
The claim adds to an extraordinary pile of legal trouble for the company, which is also under investigation by the Serious Fraud Office for suspected fraud and bribery. The SFO opened its investigation in January, and six people were arrested in Britain and Italy. The Financial Conduct Authority opened its own investigation in 2024.
Home REIT's troubles began in 2022 when activist short-seller Viceroy Research raised concerns about its tenants, rental income, property transactions and valuations, causing the share price to plunge. The company said at the time that the allegations were without substance, but its shares were suspended for three years. In that period it raised more than £850 million in three years, promising to buy property that would be let to publicly funded charities and community groups to house vulnerable people while generating rental income.
Its property portfolio has since been sold and its four wholly-owned subsidiaries are in liquidation. Home REIT says on its website that it is in a managed wind-down. In April its listing was restored and properties were sold. It has forecast significant costs defending the company and former directors from potential shareholder-related litigation.
The investors' lawsuit is the latest chapter in one of the most spectacular corporate collapses on the London market in recent years. It raises difficult questions about how a company promising both profit and social purpose was able to attract hundreds of millions of pounds before its business model disintegrated.
The SFO's criminal investigation, the FCA's regulatory probe and the new civil claim will now run in parallel, with the fraud watchdog's findings potentially shaping the civil litigation. For the hundreds of investors who backed Home REIT's homelessness mission, the prospect of recovering meaningful sums remains uncertain, but the legal net around the company and its former directors is tightening.