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Investment in social and affordable housing funds rises 35% to £5.1bn
Investment in social and affordable housing funds rose 35% in 2022 to £5.1bn, a report has found.
An annual survey of social impact investment by Big Society Capital found that £1.1bn of social and affordable housing fund deals were committed in 2022, an increase of 35% since 2021.
The impact investor said that social and affordable housing funds now account for 55% of the social impact investment market, which altogether stands at £9.4bn, an 18% increase since 2021.
The social and affordable fund asset class has grown substantially since being worth virtually zero in 2012, Big Society Capital said. It increasingly attracts investment from local government pension schemes such as the Greater Manchester Pension Fund, London pension funds and the Swansea and Strathclyde local government pension scheme funds.
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Growth in affordable housing investment this year was partly thanks to the addition of new funds managed by Legal & General and M&G, in addition to new equity raises, the report said.
The market also saw growth across existing affordable housing funds and funds that support those at risk of homelessness. These include CBRE’s affordable housing fund, the Man GPM RI Community Housing Fund, Resonance’s National Homelessness Property Fund 2 and Social and Sustainable Housing 1.
Examples of where investment is going include Grand Union Housing Group, which has provided 79 new homes to key workers in Milton Keynes with fund manager Man Group. Man Group’s Community Housing Fund aims to deliver 1,300 affordable homes by 2026.
P3 Charity has provided 300 affordable homes in Gainsborough, Lincolnshire with fund managers including Social and Sustainable Capital. Meanwhile Notting Hill Genesis will manage almost 600 properties aimed at supporting families with highest need alongside fund manager Resonance.
Gemma Bourne, managing director and head of property at Big Society Capital, said that the investor supports Inside Housing’s Build Social campaign, which is calling on all political parties to commit to building 900,000 social rented homes in England over the next 10 years, with separate targets for other UK countries bringing the overall total to more than one million.
Ms Bourne said: “Big Society Capital and our partners in social investment have been investing into social housing for the past 10 years – and it has been brilliant to see the market scale rapidly from being worth virtually zero in 2012 to over £5bn.
“But the work is far from being complete if we are to see a Britain where homelessness and insecure housing is an issue of the past.
“We are strong supporters of Build Social’s call for policymakers to make a serious commitment to social housing. We would add that they might want to consider social investment to help crowd in further investment.
“For example, a recent investment from the Department for Levelling Up, Housing and Communities leveraged in an additional £80m from social investors to deliver 500-plus housing units for families at risk of rough sleeping.”
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