1 / 8

Developing new homes

Developing new homes. estimated £2 billion in co-op housing sector spread unevenly across c250 housing co-ops 150 have useable assets? average 30 homes in each co-op could be cleaned ”? average value of £150K per home? £675m in available asset cover across the sector ?.

kreeli
Download Presentation

Developing new homes

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Developing new homes

  2. estimated £2 billion in co-op housing sector • spread unevenly across c250 housing co-ops • 150 have useable assets? • average 30 homes in each co-op could be cleaned”? • average value of £150K per home? • £675m in available asset cover across the sector?

  3. Value for Money standard “Providers must maintain a robust assessment of the performance of their assets” • will Government come looking for our assets?

  4. its not as it once was! • very little grant funding available if any (15% of scheme costs?) • a lot of strings attached – “affordable rents” • can only be accessed through a Registered Provider who has an allocation or … • HCA community-led housing funding • can be used for variety of tenure approaches

  5. Getting loan funding • very difficult for one off schemes at good rates • work with the Mutual Housing Group and HCA to establish a “warehouse fund” to package the requirements of schemes • estimated requirement of £100m to £200m • including Starlings • funding prospectus to get financial intermediary to arrange funding • could be “phase one” of viable schemes

  6. Criteria for viable schemes • a group that can demonstrate effective governance and likely long term sustainability • a real site and a realistic scheme proposal • active support of local authority • a realistic development partnership • not consultant driven

  7. What might investors fund? • CCH meeting with a pension fund investor brought out the following options: • participating in large scale bond issue (ie. the warehouse fund approach) minimum of £5m at “gilts” + 2% (good rates) • “purchase & leaseback” option – ie. money from pension funds buys co-op properties providing money to develop more homes – and then leases them back to the co-op over 35 to 40 years at a lease rate linked to inflation. Minimum £5m and would prefer batched approaches. Option to buy back at end of period for £1.

  8. using pension funds to build new homes and manage them on 8 to 10 year management agreements. £5m to £10m investments. KPIs agreed with co-op, but no interest in management policies. Management fees between 20% and 35% but VAT an issue.

More Related