ESG Impact and Allocation Report
Appendix 2
Sustainable Bond Allocation and Impact Report 2023/24
Contents
5 Audit/Limited sssurance 6
6 Important information 6
1. Executive summary
1.1. Beyond Housing is a registered Community Benefits Society (CBS), we have a group turnover of c£93.7m in 2023/24. We own and manage c15,354 homes across nine local authorities in the north-east, housing over c30,000 customers. Our staffing numbers are c726 people (FTE), and we offer housing for rent and sale, including shared ownership.
1.2. Our five-year strategy is based on four strategic objectives:
· Provide quality services to our customers - increase customer satisfaction, grow our independent living business, and have 65% of our customers using digital services.
· Build new homes and keep our existing home in good condition - build circa 2,750 new homes, increase Tenant Satisfaction measures (TSM) customer satisfaction with the quality of our homes and repairs satisfaction and improve the Energy Performance Certificate (EPC) ratings for all our homes to EPC C or better by 2030.
· Invest in our communities/neighborhoods to create a great place to live and work - offer the best information and advice to customers, be a leading training provider and create neighborhoods our customers are proud of.
· A great place to work for our people - achieve Investors in People (IIP) accreditation, deliver an agile working environment, increase colleague satisfaction, and improve the health and wellbeing of our staff.
1.3. In 2023/24 on the balance sheet, we invested £45.5m on housing property for letting,
£26.5m on completed shared ownership homes and £6.1m on new shared ownership properties under construction. We completed 291 homes as we work towards our overall program to meet nearly 2,750 homes by 2030/31. Of the 291 homes delivered in year, 144 were for affordable rent, 44 shared ownership, 43 rent to buy, 9 social and 51 outright sales.
1.4. We made significant progress with the regeneration of the Church Lane (North) estate in Eston during 2023/24 which is now close to completion. We have invested circa £16.7m in delivering the project to build c33 new homes, refurbish existing homes, create street and garden layouts, achieve EPC C targets and create green spaces.
1.5. We are committed to reducing our operating carbon footprint through our direct and indirect emissions. This includes gas, electricity, vehicles and travel. In our annual accounts we publish our annual emissions performance. Emissions have increased in the year and reflect increased office and fleet consumption.
2. Bond overview
2.1. In May 2021 Beyond Housing issued its first sustainable Environmental, Social & Governance (ESG) bond. The issuance, of £250m notional value, had a day-1 size of
£165m, with net proceeds of £161.3m. In November 2022 £40m of the retained bond was issued through a forward purchase agreement with proceeds in November 2023. The retained portion, totalling £45m, makes up the balance of the notional value.
2.2. Beyond Housing bond details at 31 March 2024.
|
Notional Value |
£250million |
|
Currency |
Pound Sterling |
|
Maturity |
2051 (30 years) |
|
Format |
Secured, senior, bearer |
|
Repayment |
Bullet |
|
Moody's Rating |
A2 stable (October 2023) |
|
Coupon |
2.125% |
|
Listing |
International Securities Market (ICMA) of the London Stock Exchange |
3. Allocation summary
3.1. The proceeds from the issuances have been allocated in line with our Sustainable Bond Framework, including refinancing of existing assets as well as a proportion allocated to new developments. Assets refinanced by the proceeds of the Sustainable Bond were identified according to the criteria in our framework. Refinancing accounted for 80% of net-proceeds of the initial issuance.
4. Impact
4.1. Environmental - We align many of our activities to the ESG framework. Most of our properties (c85%) are Energy Performance Certification (EPC) 'C' or above, and we plan for all properties to achieve a 'C' rating by 2030. We install only energy 'A' rated boilers, and our annual capital works program includes insulation, double glazing, kitchens and bathrooms, s ensuring c100% of our homes meet decency standards every year.
We have waste disposal contracts with suppliers to recycle many of our materials.
Social - We follow stringent gas and electric testing safety protocols to ensure all properties are compliant and safe . Customers are surveyed e with regards to satisfaction and have the opportunity to be involved and scrutinize our services. We ask all our larger contracts to outline their social values and sustainability standards in tendering.
Governance - Our regulatory grading from the Regulator Social Housing is G1/V1 (March 2024).
4.2 Some of our housing projects
4.2.1 De-carbonisation - In 2023 Beyond Housing secured a further £1.12m of grant from the Social Housing Decarbonisation Fund, through the Tees Valley Combined Authority consortium. The grant, supported by additional match funding of £2.5m from Beyond Housing will improve the EPC ratings and carbon emissions of 97 homes across our communities in the Redcar and Scarborough areas.
The proposed projects include energy efficiency measures installed at 65 dispersed properties throughout the region, including insulation, upgraded heating controls, solar PV and Air Source Heat Pumps to some properties. The second project is the installation of a shared ground loop system, solar PV, external wall insulation and energy efficient windows to a block of 32 flats in Hunmanby.
4.2.2 Loftus development - Beyond Housing delivered the final £15m phase of our £43m development in Loftus. The development includes 73 homes for affordable rent and 12 homes for rent to buy.
4.2.3 Homelessness - Beyond Housing formed a partnership with Scarborough Borough Council, North Yorkshire County Council , to tackle homelessness in Scarborough. Reducing Exclusion for Adults with Complex Housing Needs (REACH) is a three-year project supporting homeless people into housing and providing them with the tools they need to establish independent living. The scheme has a total cost of £896,939, with funding of £345,000 secured from Homes England. The Scarborough-based project aims to identify the most vulnerable people whose complex life circumstances and needs are preventing them from finding a home on the same-day basis as everyone else, often because they need extra support.
Two groups of apartments in Scarborough, were completed to support homeless people in the area. Alongside housing, the project team provides support and guidance about alcohol or substance misuse, mental health needs, and the reduction of anti-social behaviour and criminal activity - all of which can be barriers to sustaining a tenancy and can limit employment prospects.
4.2.4 Middlesborough - Development of30 new two-bedroom apartments at the Boho Village development in Middlehaven. The apartments were delivered in partnership with Middlesbrough Development Company Ltd (MDC) and contractor, Equans. The purchase was supported by Homes England with grant funding totaling £1.1m. All the apartments are equipped with air source heat pumps, efficiently reducing carbon emissions by extracting renewable heat from the environment to generate hot water and heating in the home. This project supports Middlesbrough Borough Council's commitment to restoring and regenerating Middlehaven as the centre of thriving businesses and homes that it once was. With the multi-million-pound investment, the council's ambitious Middlehaven Development Framework has included bold ideas providing education, housing, retail and leisure facilities.
5. Audit/Limited Assurance (RSM)
5.1 This report has been submitted to RSM to be independently audited by RSM (Beyond Housing's external auditors) and following this a report will be provided to the board and M&G investments.
6. Important Information
6.1 This report:
· Has been prepared by Beyond Housing for information purposes only
· It does not form a legal investment, tax, accounting of other financial advice
· Is intended to provide non-exhaustive, indicative and general information it is not intended to be full comprehensive
· Should be read in conjunction with the Annual Report and Accounts 2023/24.
6.2 This report has been prepared based on reviews and analysis of our loan and data statistics. The report contains backward and forward-looking information. Information has been provided by third parties and the borrower. The information is relevant only on the respective dates.
6.3 Beyond Housing makes no representation, warranty, assurance of any kind, expressed or implied, or takes no responsibility or liability as to the fairness, accuracy, reliability, reasonableness, correctness or completeness of any opinions or conclusions in the report.
6.4 The report offers no security or investment advice.
6.5 Beyond Housing is not liable for any loss, damage, liability or expense incurred or suffered that is claimed to have resulted from the use of this report by the recipients, including without limitation and direct, indirect, special or consequential damages.
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