Lloyds to convert unused offices into affordable social housing
Lloyds Banking Group is poised to start converting its disused office space into social housing following Labour’s election win and a foundation being laid by some of the UK’s largest mortgage providers for an exponential housebuilding increase.
The banking group will launch their programme with decommissioned office space in Pudsey, West Yorkshire, by selling the site to a local housing group with the agreement that 80 new homes will be rented at about half of the market rate.
A comprehensive review of the group’s legacy commercial real estate portfolio is currently in progress, with further plans to identify additional sites for future development as social housing through partnerships with housing providers in the coming years.
This is in conjunction with their announcement that they plan to expand their private rental arm, Citra Living, which until now has only been involved in Build-to-Rent. This move would place them as the first UK bank in the affordable housing market.
These plans are set to start from next month in Cambridge with the rentals being offered at 80% of the market rate. This will be done by Citra purchasing the properties and maintaining their status as the landlord while ensuring local authorities take on the general management.
Chief executive Charlie Nunn, as part of a wider package, prepares to host the inaugural social housing forum in London, bringing together housing bosses and policymakers to discuss building one million social and affordable homes.
Charlie Nunn established the Social Housing Initiative (SHI) in 2023 in an effort to address the lack of social housing and truly affordable homes in the UK by bringing together leaders from a variety of sectors.
Nunn explained: “When you’re in the affordable space, [which is] the low end of the private rental space, we think that’s a really important pathway to home ownership.”
Lloyds claims that it’s already “the biggest supporter of social housing in the UK” working with over 340 housing associations of all sizes.
The bank is also ring-fencing £200 million in loans for small housing providers who might otherwise struggle to access funding. Nunn acknowledged that while there is a “low return hurdle” on these loans, it still “meets our shareholders’ expectations”.
Lloyds Banking Group is also going to publish a white paper that will promote a new phase of social housing investment. The SHI members are collaborating to develop pilot projects that will lower housing barriers, free up land for development, and lessen the burden on local governments to provide housing for those who need it immediately.
Commenting on this exciting news, Compariqo’s Head of Business Development, Greg Williams, said, “Seeing Lloyd’s dedication to social and BTR schemes shows the dedication to help during the current housing issues.”
“With Compariqo’s commitment to supporting social housing schemes, Lloyds £200m investment for both large and small housing projects is something we love to see”
Need cover on a project?
Compariqo supports Social Housing Projects in the UK through our suite of available cover, as well as our extensive industry connections and experience, to help your project succeed.