Savills IM acquires majority share in the UK Affordable Housing Platform Simply Affordable Homes
29 September 2022
Savills Investment Management (“Savills IM”), the international real estate investment manager, has acquired a majority share in Simply Affordable Homes from Centrus Financial, the leading corporate finance advisor to and long-term supporter of the UK Affordable housing sector, which will retain a minority interest. This follows on from Savills IM’s acquisition of Pitmore, the UK development and build-to-rent (BTR) specialist, and together creates a strong UK residential platform for Savills IM.
- Acquisition will assist the continued expansion of Savills IM’s European Living Platform
- Provides foundation for launch a UK Affordable Housing Fund in early 2023
- New strategy aims to both help Housing Associations release capital from their balance sheets as well as to deliver new high quality affordable homes into an underserved UK market
The acquisition of Simply Affordable Homes includes a Registered Provider (‘RP’) approved by the Regulator of Social Housing (“RSH”). Remaining with Simply Affordable Homes RP are the co-founders, CEO, Dominic Curtis and the FD, Jonathan Clarke. Both will focus, full time, on the growth of the business.
Simply Affordable Homes RP has an experienced and well-respected board which consists of Chairman, Keith Exford CBE who has over 40 years of housing and property experience including until 2018 as CEO of the largest housing association in Europe, Clarion Housing. Ann Santry CBE has 38 years’ experience working in the social housing sector of which 18 years were spent as CEO of Sovereign Housing and Jack Stephen was FD of Thames Valley Housing Association for 21 years where he was responsible for establishing Fizzy Living, the PRS specialist.
The first new product following the acquisition will be the launch of Savills IM’s UK Affordable Housing Fund (“the Fund”). The Fund is intended to have strong sustainability and impact credentials with a primary focus on increasing the supply of Affordable Housing to meet the substantial need which exists across the UK. It will target operating with high environmental standards and within the scope of Savills IM’s broader net zero carbon targets. The Fund is intended to have flexibility to invest in both shared ownership and affordable and social rent. It seeks to purchase existing stock from Housing Associations, thus allowing them to recycle limited capital and support spending on new home development along with investment in fire safety and decarbonisation. In addition, it will look to create new stock through forward funding and purchasing from both private developers and Housing Associations, both through s106 agreements and using grant funding.
The platform aims to help tackle the UK’s housing crisis through partnership arrangements with Housing Associations and private developers whilst providing low risk, index-linked returns with favorable impact outcomes for investors. It is the intention that Simply Affordable Homes RP cbecomes the exemplar for-profit RP investment vehicle for UK institutions seeking long-term stable returns in this sector.
The Fund will leverage the wider investment management resources of Savills IM and additionally the research and broking capabilities of the residential team at Savills IM’s sister company Savills UK, the leading UK residential adviser. With both this and the Pitmore acquisition, Savills IM can now consider a wide range of both private and Affordable Housing opportunities across the UK.
Alex Jeffrey, Chief Executive of Savills IM, comments:
“People in the UK face serious housing challenges, especially as regards affordability. Institutions can play an important part in helping to bridge this gap whilst providing attractive returns for their beneficiaries. This acquisition and subsequent fund launch will allow investors to gain access to this high quality asset class and be a means of meeting their own commitments to socially responsible investment.
We are delighted to bring the Simply Affordable Homes team on board and to partner with Centrus Financial. Together, they have a deep understanding of the sector and bring a wealth of experience and connections. They will be instrumental as we continue to build our Living platform and create a range of products to best serve both existing and new clients.”
Keith Exford CBE, Chairman of Simply Affordable Homes RP, comments:
“This acquisition will allow Savills IM to raise the funds to grow Simply Affordable Homes RP. Our board and management team is comprised of people with a deep-rooted commitment to affordable housing and extensive practical experience. Our business is intended to support the delivery of new homes by private developers and Housing Associations, rather than compete with them for new supply.
We will strike partnerships that promote a collaborative approach to asset management, releasing the inherent value held in longstanding assets. We are committed to providing high-quality, well managed and sustainable homes, and will generally look to our partner Housing Associations to continue to manage these assets, ensuring high quality services for our tenants.”
Institutions can play an important part in helping to bridge this gap whilst providing attractive returns for their beneficiaries