Homes England agrees £590m of strategic partnerships with eight associations

News03 Jul 2018Kane Mumford

Homes England has announced £590m of strategic partnerships with eight housing associations to deliver more affordable homes across the country.

The investment body will fund a “first wave of strategic partnerships” with EMH Group, Great Places, Home Group, Hyde Housing, L&Q and Places for People. Deals have also been struck with the Matrix Partnership, which includes five associations and councils, and a collaboration of Sovereign and Liverty.

The first-wave associations have agreed to increase their development programmes in exchange for an additional year’s funding beyond the current Affordable Homes Programme, according to Homes England.

They will have “the ability to use their funding flexibly across their development programme in response to the ebb and flow of progress on individual sites.”

The associations will be able to determine the tenure of affordable homes as they near completion on individual sites by managing the overall tenure balance through the oversight of a strategic partnership board with Homes England, said the agency.

The funding, which is part of the £1.6bn announced last week to build 23,500 homes, is for 14,280 additional affordable homes by March 2022. The rest of the homes will be mixed-tenure, including for market rent.

Homes England’s chief investment officer, Gordon More, told Social Housing in March that the agency was looking to form a “coalition of the willing” to take a different approach to social housing investment.

Homes England will start fresh talks with the sector over the summer to discuss a second wave of strategic partnerships with housing associations.

The agency said it will “be looking at the lessons learned from the first wave of deals to see what flexibilities can be offered to site-by-site-based bids”.

Strategic partnerships: housing association deals with Homes England

Partnership	Grant	No. of additional affordable starts to March 2022
EMH group	£30.5m	748
Great Places	£29.2m	750
Home Group	£85m	2,300
Hyde	£95.4m	1,623
L&Q	£85m	1,724
Matrix Partnership	£77m	2,257
Places for People	£74m	2,603
Sovereign/Liverty	£111.5m	2,275

Table published by Homes England on 3 July 2018

Leaders of housing associations in the first phase of funding have welcomed the strategic partnerships, and placed an emphasis on the opportunity to use more modern methods of construction (MMC).

On behalf of the Matrix Partnership of housing associations and local authorities, Chris Handy, chief executive of Accord Housing Group, said it will deliver a “high percentage” of its new homes through the not-for-profit Local Homes’ offsite manufacturing hub.

David Montague, chief executive of L&Q, said: “Today is the beginning of a cornerstone relationship that will enable us to deliver more genuinely affordable homes where they are needed, and explore modern methods of construction that will allow us to achieve a step change in production without compromising on quality.”

Mark Washer, chief executive of Sovereign and Paul Crawford, chief executive of Liverty, said in a joint statement: “Building the homes ourselves through land-led opportunities, rather than relying on Section 106 agreements, significantly increases the volume of new homes being delivered.

“We’ll also be supporting other regional associations to access capital grant, again accelerating additional growth and delivery even further.”

Secretary of state for housing, communities and local government, James Brokenshire, who announced the funding this afternoon (3 July) at the Local Government Association’s annual conference, said: “This £590m fund we are giving Homes England will help housing associations accelerate the delivery of affordable properties communities need.”

Nick Walkley, chief executive of Homes England, said: “This is a very important day for us but we have no intention to stop here. Over the summer we will work to expand the eight deals to become even more ambitious while agreeing a second wave of strategic partnerships with other ambitious housing associations.”

David Orr, chief executive of the National Housing Federation, which worked with Homes England and the Ministry of Housing, Communities and Local Government on the strategic partnerships, said: “We are delighted to have worked in close partnership with Homes England on this new approach to investing in affordable housing, which will support housing associations’ vital work to help solve the housing crisis.”