Solventis has launched the socially responsible investment fund Fondviso with which it expects to raise up to 650 million euros for the construction of 12,000 affordable rental homes in Spain over the next 10 years. It is anticipated that, of this total, 600 homes will be built in the Balearic Islands, involving a direct investment of 100 million euros of the estimated total investment of 2 billion euros. This allocates at least 5% of the fund's portfolio to the Balearic Islands, a region identified as having a significant shortage of affordable rental housing.
The fund seeks to contribute to initiatives of the Conselleria d'Habitatge, Territori i Mobilitat in the Balearic Islands, which provides municipalities with land for the construction of public housing for affordable rentals, allowing private developers to obtain the right of superficies.
Fondviso focuses on accelerating the development of affordable and sustainable rental housing in Spain, especially in regions such as the Balearic Islands, where rental prices represent an average of 48.8% of net household income. According to Toni Bosch, director of alternative real estate investments at Solventis, in the Balearic Islands, the financial effort required to rent a property is 30% higher than the national average.
Fondviso is recognised as a closed-end collective investment fund, focused on affordable social housing and following ESG (environmental, social and governance) criteria. It seeks to reduce the total cost of habitability for the tenant by 30%, combining rent, energy, water and maintenance costs. This fund also aims to target 30% of the Spanish population with average incomes between 28,000 and 45,000 euros.
The Balearic administration will have a greater capacity to increase the stock of affordable rental housing without going into debt.
The model proposed by Fondviso allows public administrations, such as the Balearic Islands, to increase their supply of affordable rental housing without incurring additional debt. Under this scheme, administrations can significantly increase the amount of housing available without direct investment. After an agreed period, the buildings will become public property.
Investors in Fondviso expect to earn a net annual return of more than 7%, assuming mainly the construction risk. The fund aims to support projects with a positive social impact and contribute to sustainable development without generating public debt.
In addition, Fondviso aligns with 10 of the 17 United Nations Sustainable Development Goals (SDGs), with a particular focus on environmental, social and economic sustainability, facilitating universal access to housing and improving the socio-economic environment of affected communities.