Great Places reassures after Fitch downgrade

A NUMBER of housing associations, including Manchester’s Great Places Housing Group, have been downgraded by credit agency Fitch amid concern over expansion outside social housing and increased debt levels.

Great Places, A2Dominion Housing Group and Genesis Housing Association have seen their credit rating moved from AA- to A+ by Fitch.

The not-for-profit Manchester-based group, which generated a surplus of more than £9m on turnover of £85m in its most recent financial year, responded with a statement that it is in a strong financial position.

Director of finance Phil Elvy said confidence in the sector had been undermined  by the financial problems faced by the Cheshire-based Cosmopolitan Housing Group in relation to its student housing activities in 2012/13.

Mr Elvy said: “No sector could go through the Cosmopolitan events and come out the other side totally unscathed.
 
“As a significant developing registered provider, Great Places’ business model is predicated on increasing levels of debt over time, and the fact that we are fully funded through to 2018 reflects that situation.

“Fitch has identified wider concerns around diversification into non-social housing and the private real estate market – we understand the risks inherent in those activities and have made only very modest plans to expand in those areas, building on the strength of our development and shared ownership sales operations.

“The vast majority of the Great Places business is our core social housing rented service and we continue to focus on making that more effective and efficient, enhancing the service provided to our customers.”

Great Places which has properties in Greater Manchester, Merseyside, South Yorkshire and Staffordshire, has successfully raised £200m debt via  bond issues.