Hyde Group and Legal & General have announced the formation of a new investment partnership to deliver more affordable homes across the UK.
The joint venture brings together two of the UK’s largest investors in housing: L&G – a major UK insurer, pension scheme manager and affordable housing leader that has invested more than £1billion through its L&G Affordable Homes business, and Hyde, a not-for-profit housing, property and community services provider that owns or manages 125,000 homes.
The 50/50 partnership is launching with a seed portfolio of over 1,000 homes, encompassing social rented and shared ownership homes, with the ambition for further joint investment. The homes will be acquired by two existing For-Profit Registered Providers (FPRPs) which are jointly owned by Hyde Group and L&G – Halesworth Limited and Lanecroft Homes Limited.
Recent research by the National Housing Federation found that England needs 90,000 new social homes a year for a decade, with the government’s Social and Affordable Homes Programme only providing 20% of funding required.
Hyde and L&G say that the partnership demonstrates how pension capital and institutionally-owned registered providers can work together with housing associations, alongside public investment, to deliver additional affordable homes, with the aim of generating stable, inflation-linked returns for pension savers while delivering homes the country urgently needs.
New homes will be delivered to the highest energy performance standards, in line with Hyde’s approach that all new homes it builds will reach a minimum of EPC high band B by 2027, and EPC band A by 2030, and L&G’s longstanding commitment that all new homes will be Net Zero in operation by 2030.
Through the partnership, housing management services will be provided by the Hyde Group, including using Pinnacle Group’s platform. Hyde acquired Pinnacle Group in October 2024, creating a national housing platform that develops, manages and services affordable homes at scale across the UK. Pinnacle, which manages over 70,000 homes, already manages homes on behalf of L&G Affordable Homes under a ten-year framework agreement, providing tenancy management, building compliance, repairs and maintenance across a portfolio of c.3,000 affordable rent and shared ownership homes, with a further pipeline of over 500.
The JV says that this is the beginning of a long-term partnership that will help deliver a significant pipeline of new, high-quality environmentally sustainable homes for the future. The partnership helps accelerate L&G’s ambitions to deliver 10,000 new social and affordable homes by 2030, and Hyde is due to complete over 5,500 homes in the next five years.
Andy Hulme, group chief executive of the Hyde Group, commented: “There’s a gulf between the funding available and the funding needed to deliver the affordable homes the country needs. Grant alone will not close it. The only way we can close this gap is by bringing pension and other responsible capital into the mix – and that is exactly what this innovative partnership delivers.”
“Hyde offers institutional investors a complete end-to-end service, from investment structuring through to managing homes and the community around them, with every penny of commercial profit reinvested in building more affordable homes and improving existing homes. With L&G’s long-term capital and our national platform, we can deliver more homes, faster.”
Catherine Raynsford, managing director – stock acquisitions for L&G Affordable Homes, said: “Since establishing our affordable housing business in 2018, L&G has built a strong track record as a trusted leader in delivering high-quality, affordable homes across the UK. This new partnership with Hyde marks an exciting milestone, combining our heritage and expertise with an innovative approach that aims to attract institutional investment and accelerate the delivery of much-needed affordable housing nationwide.”
