The extent to which some of the largest London-based social landlords have scaled back their development ambitions was revealed when the Greater London Authority released their strategic partnership agreements for the Affordable Housing Program 2021-26.
The 3.46 billion offer list. The L&Q grant is only a tiny fraction of the grant from the previous 2016-23 program.
The list of strategic partnerships also seems to show the extent to which subsidy rates have skyrocketed in the wake of the reorientation of the GLA program towards housing for social rent, while at the same time the willingness of housing associations to cross-subsidize the construction of affordable housing has decreased with receipts from apartments for sale.
The £ 3.46 billion deals are expected to provide a total of 29,456 homes, compared to nearly 50,000 homes provided for just £ 1.7 billion in the previous program.
Clarion tops the list with the highest award under the Strategic Partnership Program. Its £ 240m partnership is set to supply 2,000 households. Clarion received the fourth largest award in the 2016-23 program.
Second on the list is Paragon Asra with a £ 182 million partnership for 1,455 homes, followed by Optivo with a £ 180 million allotment for 1,500 homes.
>> Click here for a full list of strategic partnership assignments
Other housing associations in the top 10 are Hyde, Metropolitan, and Genesis. However, the data also shows the extent to which the GLA now expects to rely on the councils to implement its new program – with four London boroughs being the top 10 largest grant recipients – compared to just one in the previous round.
The London boroughs of Barking and Dagenham, Enfield, Haringey and Southwark are all among the top 10 recipients of strategic partnership allocations. The counties were granted £ 171m, £ 167m, £ 127m and £ 126m respectively.
L&Q was the largest recipient of grants under the previous 2016-23 program, but this time it is on the 23rd
Housing giant, which Buildings’ sister company Housing Today announced last month, has finally given up on its promise to build 10,000 homes annually amid the huge cost of renovating existing properties, receiving just £ 55m to deliver 539 homes – 5% of that Houses it promised to build last time.
In the last program, it received an allocation of nearly £ 400 million to build nearly 12,000 homes.
Peabody, the recipient of the second largest grant in the last round, has fallen to 12th place on the table and promises to build only 1,000 affordable homes, compared to 6,000 previously. He was allocated £ 221 million in the 2016-23 program; this time he was allotted only £ 120 million.
The funding provides for 16,739 apartments to be built for social rent, of which 12,717 will be for common ownership or at the level of London housing rent.
The average grant per unit for the houses is just under £ 118,000, more than a three-fold increase from the £ 35,000 per unit in the 2016-23 program, when much of the cost of affordable housing was supposed to be cross-subsidized from private sales.
Overall, the town hall has entered into strategic partnerships with 53 providers, 26 of which – almost half – are either municipalities or development companies. The rest are housing associations. In contrast, only eight London boroughs were fellows in 2016-23.
There are also 26 new providers on the list, including the London boroughs. Other newcomers are the housing giant Places for People and the “for-profit” provider Resi Homes.
London Mayor Sadiq Khan said: “For the past five years I have led the renaissance of public housing in London thanks to our relentless focus on giving the districts the funding and expertise they need to build. I am excited to see this pay off now as more than half of the homes on this council-built deal are funded at social rents.
“[The] Funding is good news, but I know we can go faster and further by working with ministers, housing associations and councils to deliver more of the homes Londoners so desperately need. “
In total, GLA’s share of the UK Affordable Housing Program is £ 4 billion, which aims to deliver 79,000 homes. The details come a day after the government said it had allocated a total of £ 8.6 billion to 90 strategic partners across England, including the London allocation. Homes England, the institution that manages the affordable housing program outside of the capital, has not yet released details of its allocation.
The GLA and L&Q were asked to comment.
Click here to view the full details of the GLA’s Strategic Partnership Program versus last time assignments.