Home Reit reveals £503m loss in delayed 2022 accounts
Home Reit (HOME ), the homeless accommodation provider and subject of the biggest investment company scandal of recent years, has finally published its 2022 annual report, disclosing a £503m loss in asset value over the 12 months before its shares were suspended.
Having revised all its accounts since launch in 2020 in response to allegations of overvaluation by short seller Viceroy Research, the company has restated its net asset value in August 2021 as just over 103p per share.
This plunged 57.5% to 43.76p by August 2022 as a result of the alleged wrongdoing by its former fund manager Alvarium, which the company said failed to refurbish properties and deal with rent arrears or bring these problems to the board’s attention.
Alvarium was last year replaced by AEW, which is in charge of stabilising the portfolio and selling its assets in a wind-down approved by shareholders last month.
Chair Michael O’Donnell expressed his frustration at the company’s situation and thanked shareholders for their patience.
Home shares have been suspended since January 2023 and will not return to trading until the publication of the 2023 annual and interim reports.
However, O’Donnell held out hope that despite the losses and the challenges, some value could be restored to shareholders from the sale of the portfolio, which AEW had improved by finding new tenants.
This, he said, ‘has created a portfolio that, while subscale to continue as a standalone quoted entity, represents an attractive investment opportunity for investors seeking to enter the supported living and private rented sectors’.
However, he warned that the threat of costly legal action from a group of shareholders ‘would directly reduce the amount of capital ultimately returned to all shareholders and may impact the timing of any distribution to shareholders’.
The company announced last year it was preparing legal action against its former fund managers.