The UK’s largest quoted residential property owner, has paid the Church Commissioners £134.1m for a portfolio of equity mortgages paid by hundreds of retired Anglican clergy.

Grainger has bought the Commissioners’ rights to receive income and capital receipts on the mortgages, which will continue to be administered by the Church of England Pensions Board.

The transaction is in line with the Church Commissioners’ aim of reducing its exposure to UK residential property. Currently, around 1,300 retired clergy have mortgages provided by the Pension Board to assist them in purchasing retirement housing under the Church Housing Assistance for the Retired Ministry Scheme.

Peter Couch, director of retirement solutions at Grainger Trust, said: ‘This transaction provides us with a large-scale exposure to the housing market over a period of the owners’ occupation. Unlike many of our existing equity release assets, we also receive an index-linked annual cash return without the usual administrative costs, creating real value for our shareholders.’

Rupert Dickinson, chief executive, added: ‘This acquisition is an excellent fit with the rest of Grainger’s equity release and retirement solutions business and demonstrates Grainger’s ability to source and deliver innovative transactions.’