You are viewing 1 of your 1 free articles
Northern Irish landlord on track for 1,500-home plan despite post-Brexit material challenges
A Northern Irish housing association is “confident” it can build its planned 300 new homes per year after a £100m investment, despite increased building material costs.
![Roderick Canning: “We’re confident we can meet [the target] because we have a good pipeline lined up”](https://omghcontent.affino.com/AcuCustom/Sitename/DAM/179/RODERICK_CANNING_1200px_MIN.jpg "Roderick Canning: “We’re confident we can meet [the target] because we have a good pipeline lined up”")
Roderick Canning, director of finance at Apex, told Inside Housing that the increase in material costs following Brexit would be a challenge, but the social landlord still believes it can hit the figure.
The housing association recently secured a £100m debt investment from Pension Insurance Corporation (PIC) to go towards building 1,500 new homes. It will also help to refinance some existing debt.
Mr Canning said the challenges to this development plan would be around material costs.
“We’re already seeing some issues around increased material costs, first of all coming through from Brexit and then the impact of the pandemic, in terms of supply of products and components.
“There is definitely an increase in costs coming through,” he said.
READ MORE
The deal with PIC marks Apex’s first bond transaction in its own name, whereas previously it went through aggregators.
On this, Mr Canning said: “We’re quite pleased to have achieved that. It’s another avenue for the future that we’ve now got expertise, knowledge and connections in.
“We would envisage that our future routes for longer-term finance will be via the capital markets route.”
Based in Derry, Apex owns and manages more than 6,000 homes across Northern Ireland.
Its stock is set to increase to more than 7,000 once its current planned programmes are completed. The landlord hopes that in the next four to five years, it will grow to 9,000 homes.
Mr Canning said: “We’re confident we can meet that [300] number because we have a good pipeline lined up.
“And that’s what this finance is hopefully going to support in the next four to five years.”
He added that the housing association “would love to do more”.
“There is certainly demand for more – the waiting lists in Northern Ireland are continually growing,” he said.
Government figures that emerged last week showed that the number of households in temporary accommodation in Northern Ireland has increased by 74% in the past three years.
In October, the Department for Communities announced additional funding of up to £15m for housing associations to go towards the delivery of new social homes in light of the rising costs of materials.
“But at this point it would be difficult to ascertain how far that will go,” Mr Canning said.
The cost of living crisis has also led to a smaller rent increase for Apex tenants.
The rent will go up by 3.75% in 2022-23, lower than the Consumer Price Index (CPI) plus 1% Apex usually increases it by.
“We didn’t go as high this year in light of the difficulties. The board will always take those matters into consideration.
“Next year could be a more difficult decision, given where inflation is going to go,” Mr Canning explained.
Sign up for our Northern Ireland bulletin
Already have an account? Click here to manage your newsletters
