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Month: June 2024

Centrus sponsors St Paul’s Panthers football tournament

Posted on by Georgie Knight

Centrus Communities is proud to have supported the St Paul’s Panthers football tournament 2024 on Saturday 22nd June 2024.

The tournament hosted over 750 children from 5-13yrs old with the mission of inclusion for boys and girls of any standard from local primary schools and local football clubs, giving them the chance to play in the Meadowbank stadium – home of the Surrey FA and Dorking Wanderers FC.

Centrus’ Chief Sustainability Officer, George Roffey played a key role in organising the tournament along with other committee members Stuart Dodds (Chair), Grant Spooner, Ben Green, Gareth Key and Amy MacKinnon. A massive thanks to everyone involved!

UK Affordable Housing Market Update | June 2024

Posted on by Georgie Knight

Market update

  • The wait for CPI to fall to target is over, with the May 2% result meeting economist expectations. Will CPI hold at this level, will we now see interest rate cuts?
  • Higher than expected service inflation (5.7%) led the market to dial back bets on interest rate cuts in 2024. The service economy continues to resist higher interest rates and until there is a meaningful change in this trend, interest rate cuts will likely be delayed.
  • The market expectation for SONIA in 2025/26 and 2026/27 is 10 bps and 20 bps lower than a month ago respectively. It is higher for longer in 2024, with a steep fall priced in through 2025 to c. 4% later in 2026.
  • Swap and gilt curves for 10 and 30 year are down 25 and 20 bps respectively on a month ago. Gilt yields combined with tight spreads look appealing, despite a c. 10 bps tick up in spreads from the lows a month ago.


Implications for clients

  • We may wait a little longer for the first rate cut but there is a little more headroom in June business plans with forward SONIA down for 2025/26 and 2026/27. Locking in that fall could be attractive unless hedging ratios are already at the upper end of policy range.
  • Bookrunners continue to suggest modest premium on sub-benchmark issuance for good credit, and investor demand for medium-term notes is more than sufficient to meet supply leading to attractive spreads. Housing Associations have a wide range of DCM funding options, and an unusually low cost of carry thanks to high short-term rates.
  • With the election looming there is a chance of domestically driven volatility. The global financial system continues to adjust to higher bond yields and there is always a chance of further shocks as we saw in 2023 with the various bank failures. It makes a lot of sense for Housing Associations to avoid delay in locking in cost of capital and funding for fresh investment plans.


Recent client activity

At Centrus, we are actively developing hedging strategies and participating in business planning and assurance engagements for our housing clients. Recent activities include:

  1. Business planning and assurance engagements: Centrus recently worked with Capital Letters, providing their Board with confidence and assurance that their business plan was founded on informed assumptions and driven by a best-in-class model.
  2. Investment policy reviews: Investment policy reviews are a recent common trend, with a focus for some of the best way to look after significant chunks of cash post asset disposal or capital raise. Beyond paying down RCF, we have focussed on money market funds.

To learn more about our work in the affordable housing sector, click here.

For more information, please contact Paul Stevens or John Tattersall.

Centrus Impact Report 2023

Posted on by George Roffey

Executive Summary

We are proud to publish our second Impact Report as a certified B Corporation. This shares our achievements, impact and ambitions across sustainability, social responsibility and governance with the lens on 2023.

“The macro-economic challenges and ESG backlash rose fervently in 2023.
In the face of these challenges Centrus remains committed to high standards of verified social, governance and environmental performance and has backed this up with public transparency and accountability. Our people and our purpose are backed by the delivery of bespoke solutions for projects, companies & assets that matter to people, communities & the environment”. George Roffey, Chief Sustainability Officer at Centrus.

At Centrus, our sectors of operation have tangible impact on the environment and on society. As a service provider, our action and output on our value chain is far greater than our supply chain inputs and in this service provision, people are our most valued asset. So that our people know how their role contributes to ESG, we strive to set an exemplary internal footprint.

Download our impact report.

CEN_2023ImpactreportMASTER-1Download

For more information, please contact George Roffey, Chief Sustainability Officer – Centrus

Proxima launch: France’s first independent high-speed train company

Posted on by Georgie Knight

Proxima: France’s first independent high-speed train company

Rachel Picard and Tim Jackson together with Antin Infrastructure Partners have announced the launch of Proxima, France’s first independent high-speed train company.

Centrus is proud to have acted as a key commercial and financial advisor to Antin Infrastructure Partners and Proxima founders, Rachel Picard and Tim Jackson, securing Antin Infrastructure Partners as the sole equity provider for the project.

Proxima will strengthen the offer available to high-speed rail travellers in France, providing more than 10 million new seats per year.

Click here to read the full story in Railway Gazette


For more information, please contact Stephen Layburn

Centrus Spotlight with L&G Affordable Homes

Posted on by Georgie Knight

Centrus Spotlight with L&G Affordable Housing

For-Profit Registered Providers (FPRP) have prompted a significant shake-up of the UK affordable housing market. Savills estimates that by 2028, there’ll be roughly 100 FPRPs, with 113,000 units – a significant rise from 2023.

Omer Fazal, Managing Director and Head of Real Estate at Centrus sat down with Ben Denton, CEO at L&G Affordable Homes, a leading for-profit affordable housing provider, to discuss the evolution of for-profit affordable housing and its impact on the sector.

Our recent In Focus report takes a closer look at the For-Profit Affordable Housing sector, discussing challenges faced by the UK affordable housing market and the benefits of partnership opportunities for housing associations and investors. Click here to read the report.


For more information, please get in touch with Omer Fazal.

In Focus Report: For-Profit Affordable Housing

Posted on by Georgie Knight

Introduction

For-Profit Registered Providers (FPRP) have prompted a significant shake-up of the UK affordable housing market. But the landscape is an unusual one. At present, a majority of providers are small developers, yet a significant majority of the stock is with a few larger institutions – and there have been few trades between FPRPs, a function of the nascent nature of the sector.

Analysis based on Savills research earlier this year suggests 39% of the 70 registered For-Profit Registered Providers (FPRPs) are independent developers, yet they account for only 6% of homes.

In comparison, 90% of all stock is owned by institutions, despite the fact that they make up less than a quarter (21%) of the FPRPs; highlighting the weight of capital residing with the institutions.

Recent successful fundraisings of c £250m in aggregate by the likes of Octopus, Savills Investment Management and Edmond de Rothschild, reflect a growing appetite by institutions to access this sector.

Our report In Focus: For-profit affordable housing explores:

  • For-profit affordable housing
  • Challenges faced by housing associations and local authorities
  • Market demand and opportunities
  • Benefits of partnerships between housing associations and investors

Download the report below. For more information on any of the topics discussed, please contact Omer Fazal, Managing Director and Head of Real Estate at Centrus.

Centrus-In-Focus_For-Profit-Housing-SectorDownload