Close Residential Growth Partnership LP

Close Asset Management Limited has launched the Residential Growth Partnership LP (the Fund) which offers investors the opportunity to benefit from a recovery in the residential property market, but uniquely is not principally dependent on a recovery to generate its returns.

Close launched the Residential Growth Partnership LP on the 1st October. The offer period ends on the 11th December 2009. The Fund will invest in English residential property and aims to generate a return of 8% IRR (Internal Rate of Return) per annum over five years for investors.

The Fund is unique in the UK retail investment market as it offers investors the chance to benefit from any recovery in the housing market, but crucially is not solely dependent on a residential housing market recovery for its returns. This is thanks to the funds unique acquisition strategy which purchases properties let out to the over 60's on a lifetime lease.

Nigel Ashfield, Managing Director of Close Asset Management's Property Division and Fund Manager of the successful Freehold Income Trust (FIT) commented;

"The outlook for residential property is uncertain in the short-term. The latest data is suggesting that values are stabilising, while some are forecasting that the market will ‘bottom out' in 2010. We believe there will be a sustained recovery in 2011 as unemployment begins to fall and mortgage availability improves.

"We have seen several residential property funds launched this year, most of which are reliant on purchasing from distressed sellers and a sharp recovery in house prices with their returns magnified by gearing. The Residential Growth Partnership Fund is different. It should allow investors to benefit from a recovery in house prices but in the knowledge that returns are not solely dependent on a recovery. We believe that this makes the Fund a unique, attractive investment opportunity for investors seeking diversification and attractive potential returns paid as capital gain."

Whilst the target return for the fund of 8% per annum assumes a modest recovery in house prices. Should the recovery be as strong as predicted by some independent forecasters, such as Oxford Economics, returns could exceed this target.

Close believes that the Fund will appeal to investors who are looking for exposure to a medium term recovery in the housing market, but are cautious of present market conditions. For example, investors considering buy-to-let investments, sophisticated investors seeking further portfolio diversification, SIPP or SSAS investors and higher rate taxpayers seeking returns paid as capital gains, which (under current legislation) attract a lower rate of tax than income.

The Residential Growth Partnership LP has a minimum investment of £20,000 and pays 3% initial commission and 0.5% trail commission. Close Asset Management Limited have partnered with Homewise Limited, a family run company that has specialised in the provision of life tenancies to the over 60's for more than 30 years.