Pocket Living explores setting up for-profit that could help deliver larger sites
A developer specialising in small, sub-market rate homes is exploring setting up a for-profit provider of social housing, which it says could help it develop larger sites.
Pocket Living, which builds “compact” flats for first-time buyers in London sold at 20% below market value, is researching the possibility of registering a subsidiary with the Regulator of Social Housing (RSH).
Marc Vlessing, chief executive of Pocket, told Inside Housing that while the company does not currently have any such projects in the pipeline, owning a registered provider (RP) of social housing may help it develop larger sites in the future.
Pocket would likely use a for-profit to bid for Section 106 deals on its larger developments, he said.
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He added: “The big revelation in thinking around housing in the last five to 10 years has been that between the open market on one hand and social housing on the other there is a whole range of housing need to be met.
“We are looking at the spectrum between those two extremes and asking ourselves more difficult questions than we had to when we set up 15 years ago as a market disruptor.
“If the landscape is becoming more complicated, should we also have our own RP within the mix?”
Several developers have registered for-profits with the RSH to deliver Section 106 agreements on their own schemes of late, meaning they will be able to retain the social housing they build.
Mr Vlessing said Pocket would be unlikely to bid for Section 106s on non-Pocket developments.
He indicated that any new subsidiary would likely bid for affordable housing grant, but not necessarily as a means of funding its typical model of homes.
Since launching in 2005, Pocket has delivered around 1,000 homes in London, with a pipeline of another 1,500.
In 2017, it was handed a £25m interest-free loan by the Greater London Authority to build homes using offsite construction methods and in 2018 was selected as a development partner for a number of sites owned by Transport for London.
It is working with housing association Optivo to deliver a 153-home factory-built development in Croydon, where all the homes will be for shared ownership or Pocket’s discounted product.
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