Tower Hamlets Community Housing and Poplar HARCA agree merger

The boards of non-compliant Tower Hamlets Community Housing (THCT) and Poplar HARCA have agreed to merge, with legal completion of the merger expected to take place in spring next year.

The decision was presented to both boards following a 12-week consultation with THCH and Poplar HARCA residents and completion of the merger is subject to discussions with the Regulator of Social Housing. On 8 December Poplar HARCA announced that both boards had approved the merger.

In March this year, the regulator downgraded THCH’s financial viability and governance gradings from V2 and G1 to V3 and G3 status, as it found weaknesses in the charitable housing provider’s financial position, meaning ”it is unable to meet the costs of its day-to-day operating activities and repair liabilities”. The downgrade means THCH currently does not comply with the governance and finanicial viability standard.

The potential merger was first announced on 26 June this year. A statement published by Tower Hamlets Council on 14 July 2023 said that the council would not be exploring the possibility of repurchasing THCH stock, as this would place its medium-term financial position at risk due to THCH’s significant amount of debt.

Tower Hamlets Council added that it does not have first right of refusal over THCH housing stock. 

The merger will involve THCH transferring its homes and buildings into Poplar HARCA. Poplar HARCA’s chief executive, Steve Stride, will continue as CEO and its current chair, Paul Brickell, and board will continue to lead following the merger. Anita Khan will be deputy CEO.

Poplar HARCA housing association owns and manages 9,000 homes, and THCH owns over 3,000 homes in East London.

A survey on the proposed merger received 1,098 responses from THCH and Poplar HARCA residents. Of the 786 responses from Poplar HARCA residents, 74% expressed a positive or neutral opinion about the merger.

There were 312 survey responses from THCH residents, 61% of which showed a positive or neutral sentiment.

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Steve Stride, Poplar HARCA chief executive, said: “We’ll continue to talk with residents to understand their priorities and concerns and deliver on what they tell us. Having gone through a rigorous process to understand each other’s organisations, we’re sure the merger will unlock opportunities for us to do more for more Tower Hamlets residents.”

Anita Khan, chief executive of Tower Hamlets Community Housing, said: “Over the last few months, we’ve focused on confirming Poplar HARCA as the best fit for THCH. Our Board recognises the benefits and financial security that this partnership offers in achieving our shared goals. Both organisations have worked to ensure that a merger will not only improve services for residents, but also enable more investment into homes and community initiatives.