“R3 is all about sustainable investment and delivery of shared ownership housing to provide homes for more people”

Welcome to heylo

heylo is a leading residential property company specialising in the creation and operation of full service solutions to deliver new affordable housing across the UK. We work to bring institutional investors and housing associations together to release capital from existing stock to drive new housing supply.

About heylo

heylo is a local authority joint venture company focussed on providing affordable housing across the country. Using long term pension fund investment and a full range of housing delivery solutions, heylo works in partnership with house builders, local authorities and housing associations to increase the supply of new affordable housing.

heylo maintains market leading standards of customer care via long term contracts for day to day customer and property management with housing association partners.

heylo’s solutions for housing associations are centered on two areas:

• ‘R3’ - Release, Retain, Recycle: Release capital via stock transfer. Retain customer management. Recycle embedded value to deliver more homes

• ‘Let’s Share’ - brings the affordability benefits of shared ownership to local authorities and housing associations looking to use shared ownership to deliver rented affordable housing

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heylo has developed a stock transfer solution for shared ownership properties that releases embedded value from existing stock at circa 20 times current passing rents (which must be RPI linked) up to a maximum of 80% of OMV. Management of the properties and customers can be retained and the receipt can be recycled into new homes.

Release capital from existing shared ownership properties with RPI linked rents

R3 – RELEASE, RETAIN, RECYCLE

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Overview

Retain the property managemernt and all important customer relationship

Recycle capital receipts to deliver new shared ownership without the need for increased borrowing

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R3 – Shared Ownership Solution

The current business environment in which housing associations operate is more challenging that ever. R3 is a simple and viable option for housing associations to release capital from shared ownership properties (especially those which were expected to be sold via staircasing at some point).

Releasing value via stock transfer

The transfer of stock to heylo releases significant capital and facilitates recyling and delivery of new affordable housing.

A capital release from the transfer of aged shared ownership properties, which also usually releases grant, should have a positive impact on housing association finances and viability.

Maximising value

R3 maximises the value of existing shared ownership stock - delivering significantly more capital than the sector lenders will advance.

heylo delivers a cash amount at the point of transfer of the landlord’s interest in existing shared ownership properties - this normally includes payment for any embedded grant liability which remains with the housing association unless otherwise negotiated and agreed.

Management retained

Whilst the properties are transferred to heylo, the housing association can elect to retain the property management and the all important customer relationship via a standard form management contract in place for the length of the longest lease.

“retain the property management and the all important customer relationship”

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R3 – Capital Release and Recycling Process

Using existing assets to fund new supply makes great use of embedded value which may otherwise take many years to be released through natural staircasing by the leaseholder. Where new affordable housing can be delivered for less than 75% of open market value, this capital release is sufficient to fully fund new delivery. Higher costs of new delivery may require debt funding, but given the recycling approach of R3, this funding need only be short term.

Management of leaseholders can be retained by the organisation for all properties in the model and the cost of management is recovered through lease and service charge arrangements. Once the first transaction is completed, the capital released can be used to fund a new shared ownership property on a 1 for 1 basis, and the cycle begins again.

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Transfer of Stock

Management retained

Proceeds from Transfer

Build/ Buy New Affordable

Homes

Shared Ownership Stock

Initial Share sold to new customer

Home Owners Created

Properties Under Management

Sustainable Delivery Strategy

info@heylohousing.comwww.heylohousing.com

T: 0203 744 0415