The Government’s housing agency, Homes England, has agreed to a £10 million investment with M&G Investments to support the launch of its new Shared Ownership Fund.
The recoverable investment from Homes England will help accelerate the delivery of 2,000 affordable homes through M&G’s partnership with The Hyde Group. The partnership will provide Hyde with the capital to grow its development ambitions and build additional homes in the areas it serves.
The fund has so far attracted £215m of initial investment from two local authority pensions schemes, Hyde and two M&G client funds. The fund forms part of M&G’s established residential platform, alongside the £1 bn UK Residential Property Fund established in 2013.
Homes England is keen to support the growth and evolution of housing in institutional portfolios. This is the second time that the government’s housing agency has supported M&G, after it provided funding for the construction of over 500 private rental homes, which were subsequently acquired by M&G’s UK Residential Property Fund in 2013. The establishment of funds such as the M&G Shared Ownership Fund provide institutional investors with the structures they need to invest in affordable housing.
Gordon More, Interim Chief Executive at Homes England, commented:
“Securing new institutional capital to increase the delivery of new affordable homes is a priority for Homes England. Today’s investment is a signal to both domestic and international institutional capital that the government supports sustainable long-term investment in affordable housing to meet the needs of communities across the country.
“M&G has been innovative and successful investing in both market rent and affordable housing. We welcome the opportunity to work with M&G again and to support our Strategic Partner, Hyde. We look forward to seeing the fund grow and provide access to high quality new homes.”
Alex Greaves, Head of Residential Investment at M&G, added: “Well managed shared ownership is a brilliant first step onto the housing ladder for aspirational homeowners. As trusted investors with access to deep pools of client capital, we are fully committed to innovating and improving standards – adding scale and efficiency to the Fund – as we have done in the private rented sector.
“Working in partnership with Homes England is a great example of how the private and public sector can combine forces to make a positive impact on this under-served sector.”