L&G Builds £750M Affordable Housing Business
Legal & General Affordable Homes delivered its highest number of new homes to date for the 12 months to 31 December and has made a £35M shared ownership acquisition.
Its accounts revealed that LGAH provided 1,304 new homes across the year, taking the number of completed homes owned by LGAH at the end of 2023 to 4,336 with an overall value of over £750M.
LGAH also announced a combined profit before tax during the year of £37M before valuation movements. It reported unrealised revaluation movements of £35.7M to record a pre-tax profit of £1.3M.
“The robust growth demonstrates the viability of LGAH’s business model and an overall positive year for the business,” the company said in its results announcement.
LGAH has also announced that it has acquired 390 shared ownership homes from Orbit Group for circa £35M, funded by Legal & General’s institutional retirement division and forming part of its ambitions to increase its investment in the affordable housing sector.
The Orbit Group homes are spread across 32 local authorities, including the north and south home counties, the East and West Midlands, and Norfolk.
“Our business model balances the need for investors to see a fair and reliable return on their investment, while injecting much-needed additional capital to grow the affordable housing sector,” LGAH CEO Ben Denton said in a statement on the Orbit Group deal. “At the moment, housing associations around the country are managing to create under a third of the new homes that are required. By acquiring this stock we are helping to ease pressure on local balance sheets so that they can then spend their limited funds in areas of real need.”
Orbit Group added that it aims to deliver more than 5,700 mixed-tenure new homes and regeneration properties between 2024 and 2030, while LGAH said that it is on track to deliver more than 10,000 affordable homes by 2027. Its owner, Legal & General, has created a UK residential platform that includes houses for sale and rent, retirement communities and affordable housing, and it has delivered a total of more than 16,000 homes since 2020.
