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The Housing Growth Partnership (HGP) recently announced a new £300 million commitment to SME and regional housebuilders in the UK which will help to address that demand. Here, Vic Hepburn, CEO and Head of Fund at HGP and Harry Swales, Chief Investment Officer at Homes England give their views on the new partnership, it’s aims and ambitions, and how it will help to increase housing supply.

Tell us about the Housing Growth Partnership – what does it do and how does it work?

Vic: The Housing Growth Partnership aims to bridge equity funding gaps for housebuilders, allowing them to build more homes across the UK. Since its launch in 2016 we’ve invested alongside 46 housebuilders to support the delivery of 4,568 new homes, 2,200 of those homes have already been sold to families across the UK.

And what additional benefits will this new £300 million commitment bring?

Vic: The new fund will support a range of housing tenures required to meet the UK’s diverse and evolving housing needs. Building on the success of the first HGP fund, the new £300 million commitment is a big step towards our target of supporting the development of 10,000 new homes by 2025.

It will also allow us to broaden in scope and enable investment into larger housebuilding projects with a development value of up to £75 million. We’ll be able to support the delivery of a wider range of housing projects including Build to Rent, Regeneration and Retirement Living too.

Harry: We’ll also be supporting the growth and development of the most ambitious SME housebuilders in the UK through the new Regional Growth Initiative. Taking a more flexible approach means these SME builders can target larger and more strategic sites for development. Most importantly it will provide partners  with the confidence to make long term investment decisions to facilitate growth.

That’s really encouraging. Will the Regional Growth Initiative be available in every region of the UK?

Vic Yes, in fact the first of our regional partnerships are already in four different regions of the UK. In Cumbria, for example, we’ve partnered with local developer Genesis Homes to support their target of delivering more than 180 new homes per annum by 2026. With this early stage cashflow support Genesis will be able to buy larger sites, driving its growth into a more established builder in the region.

The housing industry can be complex but it’s so important to the UK economy. How have you seen the industry and market change since the launch of HGP in 2016?

Vic: Given that our fund has existed through the EU Referendum, Brexit and Covid, I think we have just about seen everything! Some of the challenges we had before these events like construction capacity and supply have become even bigger issues that will continue to constrain the industry for some time.

Of course, people’s housing needs and where they want to live is also evolving and it will be important that housebuilders and policy makers are on the front foot with this change. The online shopping revolution had already created a conundrum around how we reinvigorate our town centres and now the Covid pandemic has made the entire UK reassess its housing requirements. Just how much of this change is permanent and what we will need to do to address longer term is very difficult to predict.

And what further changes do you think we can expect to see over the next five years or so?

Vic: I think there’s a fantastic opportunity for innovation to support both production capacity and energy efficiency, particularly with the Future Homes Standard in England and similarly ambitious targets being set in devolved administrations. The industry can’t simply pass on more build cost to home buyers given the severity of the home buying affordability issue in the UK.

Planning reform will definitely dominate focus over the next five years as well. There is an impressive amount of national ambition in that regard, but if the Bill is passed I suspect it will be very challenging to implement change locally at the pace required, given the capacity issues we know exist.

Harry: The transition towards net zero carbon will undoubtedly be a driving force for change within home building over the coming years. SME homebuilders have a vital role to play here and have an opportunity to show their ingenuity and agility in response. I am also expecting new partnership models to play an active role in the market, bringing together builders with institutional investors as well as housing associations will mean finding new ways to work together to deliver quality new homes for communities across the country. While we often see these approaches being taken larger organisations I believe there will increasingly be opportunities for SMEs to play an active role in these partnerships.

It must make a real difference when you can see families getting onto, or moving up, the housing ladder and enjoying their new homes. How does that impact what you do?

Vic: Absolutely, it’s one of my favourite parts of the role. I get a real buzz from seeing new communities build out over the development phase. I like to visit our completed sites after all the homes have sold to see how the character changes as developments mature. I’m always so impressed by how well regional builders deliver developments and the positive contribution they make to their local communities. No-one in the HGP gets near to pouring foundations or laying bricks on the sites we support (homeowners will be very relieved to hear) but we are still very proud of the homes our partners build. 

Harry: It’s incredibly rewarding to see really the positive outcomes for people and their communities, it’s great to see so many families moving into new homes enabled through the partnership. I know it’s the human stories that inspire me and my colleagues at Homes England. I’m also motivated by seeing our SME partners grow, creating jobs and taking on new opportunities, that has real impact too.

SME home builders have an incredibly important role in delivering the homes our country needs so I’m really excited about the new homes and communities that HGP’s partners will create over the coming years.

The Housing Growth Partnership (HGP) recently announced a new £300 million commitment to SME and regional housebuilders in the UK which will help to address that demand. Here, Vic Hepburn, CEO and Head of Fund at HGP and Harry Swales, Chief Investment Officer at Homes England give their views on the new partnership, it’s aims and ambitions, and how it will help to increase housing supply.

Tell us about the Housing Growth Partnership – what does it do and how does it work?

Vic: The Housing Growth Partnership aims to bridge equity funding gaps for housebuilders, allowing them to build more homes across the UK. Since its launch in 2016 we’ve invested alongside 46 housebuilders to support the delivery of 4,568 new homes, 2,200 of those homes have already been sold to families across the UK.

And what additional benefits will this new £300 million commitment bring?

Vic: The new fund will support a range of housing tenures required to meet the UK’s diverse and evolving housing needs. Building on the success of the first HGP fund, the new £300 million commitment is a big step towards our target of supporting the development of 10,000 new homes by 2025.

It will also allow us to broaden in scope and enable investment into larger housebuilding projects with a development value of up to £75 million. We’ll be able to support the delivery of a wider range of housing projects including Build to Rent, Regeneration and Retirement Living too.

Harry: We’ll also be supporting the growth and development of the most ambitious SME housebuilders in the UK through the new Regional Growth Initiative. Taking a more flexible approach means these SME builders can target larger and more strategic sites for development. Most importantly it will provide partners  with the confidence to make long term investment decisions to facilitate growth.

That’s really encouraging. Will the Regional Growth Initiative be available in every region of the UK?

Vic: Yes, in fact the first of our regional partnerships are already in four different regions of the UK. In Cumbria, for example, we’ve partnered with local developer Genesis Homes to support their target of delivering more than 180 new homes per annum by 2026. With this early stage cashflow support Genesis will be able to buy larger sites, driving its growth into a more established builder in the region.

The housing industry can be complex but it’s so important to the UK economy. How have you seen the industry and market change since the launch of HGP in 2016?

Vic: Given that our fund has existed through the EU Referendum, Brexit and Covid, I think we have just about seen everything! Some of the challenges we had before these events like construction capacity and supply have become even bigger issues that will continue to constrain the industry for some time.

Of course, people’s housing needs and where they want to live is also evolving and it will be important that housebuilders and policy makers are on the front foot with this change. The online shopping revolution had already created a conundrum around how we reinvigorate our town centres and now the Covid pandemic has made the entire UK reassess its housing requirements. Just how much of this change is permanent and what we will need to do to address longer term is very difficult to predict.

And what further changes do you think we can expect to see over the next five years or so?

Vic: I think there’s a fantastic opportunity for innovation to support both production capacity and energy efficiency, particularly with the Future Homes Standard in England and similarly ambitious targets being set in devolved administrations. The industry can’t simply pass on more build cost to home buyers given the severity of the home buying affordability issue in the UK.

Planning reform will definitely dominate focus over the next five years as well. There is an impressive amount of national ambition in that regard, but if the Bill is passed I suspect it will be very challenging to implement change locally at the pace required, given the capacity issues we know exist.

Harry: The transition towards net zero carbon will undoubtedly be a driving force for change within home building over the coming years. SME homebuilders have a vital role to play here and have an opportunity to show their ingenuity and agility in response. I am also expecting new partnership models to play an active role in the market, bringing together builders with institutional investors as well as housing associations will mean finding new ways to work together to deliver quality new homes for communities across the country. While we often see these approaches being taken larger organisations I believe there will increasingly be opportunities for SMEs to play an active role in these partnerships.

It must make a real difference when you can see families getting onto, or moving up, the housing ladder and enjoying their new homes. How does that impact what you do?

Vic: Absolutely, it’s one of my favourite parts of the role. I get a real buzz from seeing new communities build out over the development phase. I like to visit our completed sites after all the homes have sold to see how the character changes as developments mature. I’m always so impressed by how well regional builders deliver developments and the positive contribution they make to their local communities. No-one in the HGP gets near to pouring foundations or laying bricks on the sites we support (homeowners will be very relieved to hear) but we are still very proud of the homes our partners build.

Harry: It’s incredibly rewarding to see really the positive outcomes for people and their communities, it’s great to see so many families moving into new homes enabled through the partnership. I know it’s the human stories that inspire me and my colleagues at Homes England. I’m also motivated by seeing our SME partners grow, creating jobs and taking on new opportunities, that has real impact too.

SME home builders have an incredibly important role in delivering the homes our country needs so I’m really excited about the new homes and communities that HGP’s partners will create over the coming years.

 

About Vic Hepburn

Vic Hepburn is CEO and Head of Fund for Housing Growth Partnership.  Vic has 25 years of investment experience across multiple asset classes.  He helped set up The Housing Growth Partnership in 2016 and was the Head of Investments for the North Region before stepping up to become Head of Fund in 2019.

About Harry Swales

Harry is Chief Investments Officer at Homes England. Harry has over 15 years’ experience in the real estate industry as a developer, investor and funder. He is a chartered surveyor with a background in delivering projects in both the public and private sector.

 

Housing Growth Partnership (‘HGP’) has invested alongside Hollins Homes at their 80 unit development in Loveclough, Lancashire. The development comprises three, four and five bedroom open market homes, as well as twenty four affordable homes, all within an attractive countryside setting.

Residents will benefit from the stunning views of the Rossendale Valley as well as convenient access into Manchester, Burnley and Blackburn, with excellent local education provision available in the area.

John McKeon, HGP Investment Director: “Hollins are well established housebuilder with a reputation for building quality family homes in desirable locations. HGP has forged an excellent relationship with the Hollins management team across previous successful schemes and we are delighted to be investing into a further scheme with them at Loveclough. With the management team’s desire to grow the business, HGP’s investment in the Loveclough scheme will help Hollins to more efficiently deploy their own capital and further support their growth aspirations.”

Mike Cummings, Hollins Homes Finance Director: “The scheme at Loveclough represents another exciting stepping stone in the growth and development of Hollins Homes, made possible through our close relationship with HGP who have proved to be a great support to us every step of the way.”

Housing Growth Partnership (‘HGP’) has invested alongside Russell Armer Homes in phase two of their 79 unit development in Kirkby Lonsdale, South Cumbria.   This scheme is being developed under the well-established Russell Armer brand, following Genesis Homes’s recent acquisition of the company.   Phase 2 of the scheme comprises 28 two, three and four bedroom homes, in a spectacular setting nestled between the Yorkshire Dales and the Lake District.

Residents will benefit from easy access to the nearby motorway network, excellent local schools, as well as becoming part of a vibrant local community, recognised as being amongst the Sunday Times top 5 best places to live (North West) in 2019 and 2020.

John McKeon, HGP Investment Director: “Russell Armer is a long standing name in the region, with a strong reputation for build quality and customer care, and we are delighted to be able to continue our support of Genesis Homes as it expands its operational platform through the acquisition of Russell Armer.  Kirkby Lonsdale is an extremely popular location which is borne out by the demand for this site and we are confident that the quality and design of the homes will make this another successful development for Genesis Homes.”

Nicky Gordon, Managing Director of Genesis Homes: “We are delighted to have both completed the acquisition of Russell Armer Homes and in doing so been provided with this tremendous opportunity to conclude the development of the hugely successful Oakfield Park development in Kirkby Lonsdale. It was the natural choice to engage HGP and continue our journey together with opportunities in both the Genesis and Russell Armer businesses.”

For more information on Genesis Homes and Russell Armer Homes, please visit their website.

Housing Growth Partnership is pleased to announce that we have reached another milestone as our partners have now delivered and sold over 2,000 new homes across the UK.  The initial target which was set for 2023 was reached 2 years ahead of schedule in early 2021. Housing Growth Partnership continues to support housebuilders across the UK and have set the ambitious new target of supporting the delivery of 10,000 new homes by 2025.  We are committed to making a difference.

For more information about our latest partnerships, visit our case study page.  Get in touch with your local team to understand how we can support your business.

 

As we move forward into 2021, here is a business update from HGP:

In March 2020, Housing Growth Partnership (HGP) announced we had supported house builders to deliver and sell 1,000 new homes across the UK.  HGP has provided over £120m of vital support to 45 house building partners on 70 housing developments since its inception in 2015. To date, small and medium sized house builders have committed to build 3,500 new homes with our support. Of these, 1,000 have now been sold.

Vic Hepburn, CEO and Head of HGP, commented: “It is great to pass a milestone like this as we continue our support for the UK’s house builders. We are very fortunate to be able to partner with fantastic businesses that care passionately about the homes and communities they are delivering. 1,000 families have now taken ownership of new homes thanks to our partnerships, something that everyone involved with HGP is rightly proud of.”

Gordon More, Chief Investment Officer of Homes England, added: “It’s incredibly encouraging to see Housing Growth Partnership hit this important milestone. Supporting SMEs house builders to expand their businesses is an important part of our mission and vital if we are to create a more robust and resilient housing market. A lack of competition in the house building sector stifles the entrepreneurial ambition we need to increase the pace and quality of what we build, and this is precisely what HGP is seeking to address.”

Andy Hulme, Managing Director, Head of Real Estate and Housing, Lloyds Bank Commercial Banking, said: “Today’s announcement demonstrates the commitment to helping small to medium sized house builders across the UK. The contribution from the sector remains fundamental to a healthy UK housing market, and this milestone of 1,000 homes sold which equates to £1bn of much needed housing, demonstrates the ongoing positive impact of the Housing Growth Partnership.”

Housing Growth Partnership are delighted that we have been shortlisted at the 2020 RESI Awards in the ‘Residential Financier of the Year’ category. The RESI Awards, organised by Property Week, recognise excellence in the residential property market. 

Vic Hepburn, CEO of Housing Growth Partnership commented “the team have been working hard to ensure we are helping our partners navigate through these uncertain times as we continue with our mission to support the growth of SME housebuilders across the UK. There possibly hasn’t been a more important time for us to support the market since our launch and there is more we want to do. Being shortlisted for this award helps highlight the exceptional work the team has put in this year and our ongoing support of housebuilding industry’.

The highly acclaimed awards are celebrating excellence in the industry and especially during this exceptional time. The awards will be held on the 2nd of December 2020 in a virtual event. You can find out more about the RESI awards here.

Housing Growth Partnership (‘HGP’) invest in a new James Taylor Homes development brining new homes & bungalows to the village of Newton Longville in Buckinghamshire. United Trust Bank (‘UTB’) will provide the senior debt.

This scheme in Newton Longville comprises seventeen 3 & 4 bedroom houses and bungalows on an attractive low density greenfield site.

The development is within easy reach of Milton Keynes with its excellent road and rail transport links and is designed to appeal to families and downsizers.

James Hutchinson, investment director of Housing Growth Partnership, said: “HGP is delighted to deepen its strategic partnership with James Taylor Homes by embarking upon our second project together. We are also pleased to start a new relationship with UTB who is similarly focused on helping SMEs deliver more family homes. Newton Longville is a great example of HGP’s ongoing commitment to helping our partners grow and we look forward to working with James Taylor Homes and UTB.”

Emil Sohrab, managing director of James Taylor Group, said: “We are delighted to be embarking on a new relationship with UTB and enhancing our existing relationship with HGP. Our experience so far, from our initial approach to draw down, is that our proposal could not have been dealt with more professionally and efficiently. We look forward to another successful project and many more to come with both UTB & HGP.”

If you are looking for investment, speak to us today. 

Earlier this year, we held one of our Senior Advisor Forums to discuss the housebuilding sector and ways we can continue to support the development of homes across the UK.  Find out more about the event and our Senior Advisors in the video below.

Click here to find out more about our Senior Advisors and what they have to offer.

Genesis Homes was founded in 2017 with a vision of building high quality housing developments in Cumbria. To support their growth plans, Genesis sought investment from Housing Growth Partnership, who have since partnered with Genesis on 5 projects across the region.

Nicky Gordon, Managing Director at Genesis Homes, speaks about the support received from HGP in the video below.

HGP Investment Director John McKeon commented: “We are proud to partner with Genesis and support their ambition to deliver high quality homes across Cumbria. It has been a pleasure to work with Nicky and the team at Genesis and we look forward to partnering with them on more projects going forward.”

For more information about Genesis Homes, visit their website. If you are looking for investment support in a residential development, speak to one of the HGP team today.