Housing association set up by former Crest Nicholson bosses to raise cash for first 1,000 homes
Start-up “for-profit” housing association Flint Housing is to embark upon a fundraising exercise to secure around £100m of equity and an equal amount of debt to finance its first 1,000 homes.
Flint’s chief executive Eugene Schreider (pictured, right), said the firm, which had its registration approved by the social housing regulator this week, will seek to bring in funding “in the not too distant future”.
The business has been set up by former Crest bosses Stephen Stone and William Rucker, and Shreider said that all the funding to date had come from the founders.
However, he said that now registration had been achieved, the business will look to go out to the market for a “formal fundraise” of around £100m of equity funding, matched by an equal amount of debt.
Flint is the latest “for profit” registered provider to set up, with institutional investors and fund managers, including Legal & General, Blackstone, Man Group and M&G having all registered for-profit providers in the last three years, with Blackstone’s Sage Housing now owning and operating more than 5,000 homes.
A recent report by agent Savills found that for-profit providers could build 130,000 new homes over the next five years.
Shreider told Housing Today that Flint had been set up to buy affordable housing from private developers, often SMEs, who were otherwise struggling to secure housing association partners for the affordable housing required under Section 106 agreements.
Flint will then own the stock, contracting out the management of the properties to third party housing associations.
However, Shreider said the company will also seek opportunities to buy entire development from developers and convert them into affordable housing, where it can secure grant funding to support this from Homes England. Flint will not seek to procure its own sites from landowners or take planning risk.
This could also mean working with partnership housebuilders or modular housing developers such as Ilke (pictured, left) and L&G Modular, who source their own sites and manufacture homes, but don’t have any ambition to be landlords.
Schreider said: “The idea is we’re effectively forward funding development, relying on a developer to build us homes to a specification. MMC is a very interesting are offering the potential to get quicker returns for developers, in an ideal scenario we’d work together with the likes of an Ilke to take on their homes.”
Schreider said Flint is already working on its first scheme, with partnerships housebuilder Keepmoat, which comprises 32 units in the Midlands, but is in discussion with other developers, including SMEs, over other sites.
While Flint co-founder Stephen Stone is chair of Keepmoat, which Schreider said helped make the first deal happen, there was no wider partnership with the firm. “We’re discussing other Keepmoat sites and non-Keepmoat sites,” he said.
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