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French insurance giant takes 50% in Hyde’s new for-profit arm
The investment arm of a French insurance giant has taken a 50% stake in a new for-profit provider, in a deal that could unlock up to £400m in development capital over the next 10 years.
AXA Investment Managers (IM) has taken a 50% stake in Hyde Group’s for-profit provider Halesworth, which was registered with the Regulator of Social Housing (RSH) in July.
The insurer’s investment into the 50,000-home landlord has been made through a firm it owns called Newton Investco.
AXA IM will also take a 50% stake in a new development vehicle alongside Hyde and Homes England – each will take a 25% share.
All three firms have committed to investing up to £200m of equity in total into the development joint venture.
With an additional £200m in debt, Hyde said this will provide up to a total of £400m in development capital that can be deployed towards the delivery of thousands of mixed-tenure homes over the next 10 years.
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It is intended that at least half of the newly developed homes will be affordable, including for social and affordable rent.
Once complete, these properties will be offered to Halesworth and then managed by Hyde.
Andy Hulme, chief executive officer of Hyde, said: “This partnership is a fantastic example of how innovative approaches to delivering our social purpose can increase the number of new social and affordable homes built in England.”
He told Inside Housing that the partnership, along with other relationships, will support Hyde in its ambition to deliver about 20,000 new homes over the next decade.
Mr Hulme added: “The partnership will also allow us to expand our geographical reach and build in areas that need new homes the most. We will focus on the South East, where we work with about 50 local authorities across the region.
“This is because we’ve worked with them before, we know their local plans, so we have a good feel for where that real demand is in the south east and in and around London.
“But it’s not just about the numbers, we’re committed to building communities with homes rated with an Energy Performance Certificate (EPC) of A and B, which will help meet net zero targets and leave a lasting legacy.”
Acknowledging the inflationary and workforce pressures facing the sector, Mr Hulme said landlords have to “adapt to survive” in an environment where “we’re getting less for our money”.
He added: “We understand our customers are facing cost of living pressures, and we’re trying to proactively intervene to provide help and support where we can.”
Mr Hulme described it as a “great statement of support” from Homes England which signals its commitment to encouraging institutional investment into affordable housing.
Peter Freeman, chair of Homes England, said: “Our partnership with the Hyde Group and AXA IM Alts continues our mission to work with both public and private sector organisations to build more affordable homes in the areas that need them most.
“We’ll continue to embrace innovative partnerships with leading institutional investors like AXA IM Alts to ensure diversification in the housing market that will ultimately allow social purpose organisations like Hyde to keep building the new, quality homes the country needs.”
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