Bromley Council has agreed an £85m joint venture with Orchard & Shipman to provide affordable housing for homeless people in the borough.
The investment is backed by a £67m long-dated loan from Pension Insurance Corporation.
The partners will source, buy and manage 300 homes. Orchard & Shipman will own and manage the properties for 50 years, after this point they will revert to Bromley Council’s ownership.
The investment aims to reduce the council’s spend on emergency temporary accommodation, eliminating reliance on hotel rooms and nightly accommodation.
Peter Morgan, Bromley’s executive councillor for renewal, recreation and housing, said the finance “will allow us to help families in genuine need whilst better managing Bromley’s budget”.
John Knevett, chairman of Orchard & Shipman Homes, added: “With the traditional housing association sector retrenching, the market is in desperate need of new entrants and new funding models with the right long-term motives and good quality services. Novel creative models like this are perfect to help add to the numbers of additional affordable homes.”
The facility from PIC is secured on the homes and matures in 2071.
Max Cawthorn, investment strategy manager at PIC, said: “As a long-term investor, PIC has a track record of working with borrowers to structure bespoke deals that meet their needs, match secure cashflows with the pensions we will be paying decades into the future, and benefit society.”
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