Homes England, PIC and Muse form JV to deliver 3,000 affordable homes

Homes England said that Habiko will become self-funding over its 12-year lifespan and that it aims to diversify the supply chain for “future efficient housing developments”.

During the 12-year lifespan of the partnership, PIC will have the ability to continue to forward fund the development of the affordable homes. The investor will ultimately own the homes and places it has helped to create through its investment and long-term stewardship approach. 

Homes England said the developments aim to create social value for communities, including boosting the local economy through job creation and new skills to drive green innovation. The homes will be in accessible locations, close to employment opportunities, and will be designed to help residents save money on their energy bills, the agency added.

Peter Denton, chief executive of Homes England, said: “Attracting institutional investment into the housing sector is critical to build the new homes the country needs. 

“This partnership supports our partners’ objective to deliver low-carbon, low-energy, affordable homes, bringing together the technical expertise and capability of Muse with the financial capacity of one of the UK’s largest pension fund insurers, cementing PIC as a significant force in delivering affordable housing.”

Tracy Blackwell, chief executive of PIC, said: “Meeting the UK’s affordable housing needs is a challenge that is best met through effective collaboration between government, developers and private investors.

“Habiko is a great example of public-private partnership, which brings forward thousands of low-carbon, low-energy affordable homes.

“PIC has invested around £4bn in social and affordable housing to date, helping provide the secure, long-dated, inflation-linked cash flows to back the pensions of its policyholders over coming decades, creating considerable social value.”

Phil Mayall, managing director at Muse, said: “The government has set out a bold and ambitious challenge to deliver a significant number of new affordable homes over the next five years.

“Working together with PIC and Homes England, we can bring together our collective resources and unique experience to deliver thousands of low-carbon and low-energy homes which, by working alongside our local partners, meet the needs of communities across the country.” 

In May last year, Homes England said it would embark on a renewed focus on regeneration over the next five years, backed by partnerships between the public and private sectors.

In September this year, Homes England, Barratt and Lloyds Banking Group formed the Made Partnership joint venture, which aims to help deliver schemes of up to 10,000 homes.

Last month, the agency agreed to invest £29m in a brownfield regeneration project on Merseyside that will deliver more than 1,500 homes.