Riverside and One speed up full merger due to ‘economic uncertainty’

Riverside and One Housing have agreed to speed up their plan to fully merge in order to protect services in the face of ‘economic certainty’.

One Housing joined Riverside as a subsidiary last December and the organisations were planning to fully amalgamate, with One folding into Riverside, after two years.

However, the organisations, which manage 75,000 homes in total, have now decided to fully merge after one year rather than after two.

In a statement Riverside said that One, the smaller partner, had requested a speeding up of the process, as a ‘precautionary measure’ given the economic uncertainty.

It said: “One Housing will legally become part of Riverside one year earlier than initially intended.

“This is so that we can provide further protection for our customers and services under the financial resilience of Riverside.” 

>>See also: Regulator downgrades 19 housing associations citing ‘weakening housing market’

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The stock market update says the group is looking at the possibility of a transfer of engagements, the legal mechanism under which One’s assets and liabilities are transferred to Riverside, by March 31 next year. 

Riverside said the two organisations have committed to investing £1bn in stock improvment and £2.5m in helping residents with the cost of living.

It said: “We are only in a position to make these commitments because of the two organisations agreeing to come together to shield our customers and services as much as possible under the bolstered strength of the group.”

The move comes as housing associations battle with rising costs, an impending 7% rent cap and bills for decarbonisation and fire safety remediation.

Last week the Regulator of Social Housing downgraded the financial viability rating of 19 housing associations citing a “weakening housing market.” The downgrades from the top score of ‘V1’ to ‘V2’ means an organisation still complies with the regulatory standard but “needs to manage material risks to ensure continued compliance.”

Riverside and One have previously said that merging would enable a 40% increase in development capacity. Housing Today has asked Riverside whether this is still the case.

Riverside built 1,227 homes in 2021/22 and says it is on track to build 3,000 by 2023. One completed 113 homes last year.