Midlands landlord to transfer to smaller housing association in 37,000-home merger

The transfer is expected to be completed by the end of March 2025, subject to lender consents, Grand Union said in a filing this week.

The spokesperson said the groups were aiming to formally merge in December, but it was aware that “there can be unexpected delays or complexities when bringing two fairly large organisations together”.

Plans for the merger were publicly revealed in July.

Explaining the reason for the tie-up, Grand Union pointed to the “very challenging” operating environment for the housing association sector.

“Coming together now would further improve our resilience, financial strength and capacity for the future,” the group said on its website.

In its last full year to the end of March 2024, Longhurst reported a drop in surplus to £5.9m off a turnover of £171.5m, as its operating costs increased. The group currently has a G1/V2 rating with the regulator.

Grand Union posted a £4.9m drop in surplus, to £7.1m, in the year to the end of March 2024, off an increased turnover of £95.3m. The landlord has a G1/V1 rating with the regulator.

The new organisation will be led by Julie Doyle, the current chief executive of Longhurst.

Aileen Evans, chief executive of Grand Union and a former president of the Chartered Institute of Housing, will step down once the merger is finalised.

Ms Doyle said she was “delighted” to take the job, but both organisations had “acknowledged that we haven’t got everything right and there are improvements we need to make”.

In February last year, a case involving a four-year-old boy with asthma living in a mouldy flat operated by Milton Keynes-based Grand Union was reported by the BBC.

The Housing Ombudsman also identified Longhurst as having a high maladministration rate in 2022-23.

Ms Doyle added: “The opportunity to merge brings with it fantastic potential for us to achieve even more, building more affordable homes and being a reliable and trusted landlord that delivers the homes and services that our customers need and expect.”

In a consultation with residents on the merger, around 2,000 responded, the groups said. Of the comments, the landlords described 47 per cent as “positive” or “very positive”, while 20 per cent were “negative” or “very negative”.

Emma Killick, the current chair of Grand Union, will take up the same role at the new entity.

She said: “Bringing the two organisations together really does seem like the perfect fit and we’ll be in extremely safe hands with Julie at the helm.”

The merger will establish one of the largest social landlords across the Midlands and East of England, employing around 1,400 staff members.