Luminus joins Places for People
Luminus Group has joined Places for People as a subsidiary.
PfP announced today that Luminus, which owns or manages 7,640 homes in the East of England, now plans to deliver 1,000 homes over five years, and will retain its identity, local offices, management team and board as part of the deal.
The merger, which was announced in late 2017, takes PfP’s number of managed properties to 195,000.
Huntingdon-based Luminus becomes the second organisation in 15 months to join PfP after being downgraded to a non-compliant rating by the Regulator of Social Housing. Derwent Living joined the group in December 2016.
PfP said the move will enable Luminus “to increase its development pipeline to 1,000 new homes over the next five years and strengthen its financial position to deliver investment in its existing homes and services”.
Nigel Finney, managing director of Luminus Group, said: “Joining the Places for People Group is a major milestone for Luminus, which will benefit our customers, staff and the communities we work in. The opportunity to enhance our services and build more new homes as part of one of the UK’s largest and most forward-thinking housing providers is a pivotal moment in Luminus’ history.”
David Cowans, group chief executive at PfP, added: "The partnership with Luminus Group will not only provide a new operational base for Places for People in Cambridgeshire, it will also enable us to rationalise our housing stock in the region, to deliver greater efficiencies that ultimately improve local services.”
Regulatory issues
Luminus was downgraded to a G3 in March last year for failings across its governance and risk framework, and allowing gas safety certificates to lapse across more than 1,000 of its homes.
The regulator also flagged a lack of board control and assurance over a £48m investment in an external property company.
A number of changes at executive and non executive level followed, including the departure of chief executive Chan Abraham, who was replaced on an interim basis by Tom Miskell.
Luminus then reported a £52.7m deficit in the last financial year to March 2017, after the new management team opted to recognise a £47m impairment on its commercial investments in the external property development company.
Derwent Living joined PfP in December 2016, after being downgraded to non-compliant G3 and V3 governance and viability ratings by the social housing regulator in July 2016 for a number of financial failures.
Benefits
PfP told Social Housing last year that for any new joiner, the treasury function is transferred to the PfP group. Derwent’s regulatory ratings were withdrawn when they joined PfP.
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The organisations said that joining PfP means Luminus will enhance the services on offer to its customers through access to additional expertise and resources.
PfP would benefit from an additional resource in the skills, experience and local knowledge of Luminus’ employees and a new operational base in Cambridgeshire. The partnership will also provide opportunities to rationalise the management of its social housing stock and to drive efficiencies through the delivery of repairs and maintenance services.
Mr Finney added: “Over the past 17 years, Luminus has been providing affordable homes for people across the East of England. Joining Places for People offers our customers and staff the best of both worlds; enabling us to continue to deliver services locally that are tailored to our communities, while benefitting from the financial security, economies of scale and opportunities that come from being part of a much larger organisation.”
Mr Cowans said: “Luminus Group is an ideal partner for Places for People. We’re delighted to build on the successful partnership with Derwent Living last year by welcoming another regional housing provider into the group. We look forward to working together to share expertise and best practice to benefit both Places for People and Luminus.
Luminus Group is the fourth housing association to join the larger group.
Castle Rock Edinvar in Scotland joined the Group in 2005, followed by East Anglia-based Cotman Housing Association in 2009, and most recently Derwent Living in 2017.
PfP said it has demonstrated “a strong track record in supporting and enabling regional housing providers to improve the services on offer to customers, while retaining their individual local identities and service delivery models”.
It added that Castle Rock Edinvar, Cotman Housing Association and Derwent Living have reduced management costs, whilst investing more in homes and communities.
Cotman Housing Association has more than doubled the number of homes it manages and increased its operating profit by 283 per cent, the group said.
It has also achieved "greater operational efficiency through access to the group’s significant buying power, capital assets and funding".
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