Hyde Group and Legal & General (“L&G”) have announced that they have formed a new investment partnership to deliver more affordable homes across the UK.
The joint venture brings together two of the UK’s largest investors in housing: L&G – a major UK insurer, pension scheme manager and affordable housing leader that has invested more than £1bn through its L&G Affordable Homes business – and Hyde, a not-for-profit housing, property and community services provider, that owns or manages 125,000 homes.
The deal is a blueprint for how institutional capital can be invested to help fund social and affordable housing.
The 50/50 partnership is launching with a seed portfolio of over 1,000 homes – encompassing social rented and shared ownership homes – with the ambition for further joint investment. The homes will be acquired by two existing For-Profit Registered Providers (FPRPs) which are jointly owned by Hyde Group and L&G (Halesworth Limited and Lanecroft Homes Limited).
England needs 90,000 new social homes a year for a decade, according to the National Housing Federation. The government’s Social and Affordable Homes Programme provides £39bn in welcome grant funding over the next decade, but this is approximately 20% of the funding required. The partnership demonstrates how pension capital and institutionally-owned registered providers can work together with housing associations, alongside public investment, to deliver additional affordable homes – aiming to generate stable, inflation-linked returns for pension savers while delivering homes the country urgently needs.
The partnership will be jointly equity financed by Hyde and L&G. The partnership will be supported through L&G’s annuity portfolio, which deploys capital into productive assets that aims to generate income to support long-term pension commitments, whilst helping to drive regional regeneration and delivering long-term positive societal impact, as part of L&G’s £2bn commitment to drive positive social impact and growth across the UK.
Through this funding model, which leverages L&G’s long-term patient capital and the Hyde Group’s footprint, as both a social housing charity and national deliverer of housing management (through its ownership of Pinnacle Group), the JV will be able to share financial obligations and invest on a greater scale more quickly. Hyde recycles any profits into creating more affordable housing, and by re-investing in existing homes, the partnership will work together to create more high-quality, sustainable homes.
New homes will be delivered to the highest energy performance standards, in line with Hyde’s approach that all new homes it builds will reach a minimum of EPC high band B by 2027, and EPC band A by 2030, and L&G’s longstanding commitment that all new homes will be Net Zero in operation by 2030.
Through the partnership, housing management services will be provided by the Hyde Group, including using Pinnacle Group’s platform. Hyde acquired Pinnacle Group in October 2024, creating a national housing platform that develops, manages and services affordable homes at scale across all four nations of the UK. Pinnacle, which manages over 70,000 homes, already manages homes on behalf of L&G Affordable Homes under a ten-year framework agreement, providing tenancy management, building compliance, repairs and maintenance across a portfolio of c.3,000 affordable rent and shared ownership homes, with a further pipeline of over 500.³ That established working relationship provides the operational foundation for this partnership from day one.
L&G Affordable Homes will leverage its successful track record within the sector, which includes building a portfolio of over 9,000 affordable homes, to act as strategic asset manager to the partnership with assistance from Pinnacle Investments (which joined the Hyde Group in August 2025).
This is the beginning of a long-term partnership that will help deliver a significant pipeline of new, high-quality environmentally sustainable homes for the future. The partnership helps accelerate L&G’s ambitions to deliver 10,000 new social and affordable homes by 2030, and Hyde is due to complete over 5,500 homes in the next five years.
The partnership will also have the ability to invest in homes requiring green retrofit. This strategy could accelerate the improvement of customers’ homes, reduce energy bills, improve quality of life, and help deliver positive environmental impact.
Andy Hulme, Group Chief Executive of the Hyde Group, commented: “There’s a gulf between the funding available and the funding needed to deliver the affordable homes the country needs. Grant alone will not close it. The only way we can close this gap is by bringing pension and other responsible capital into the mix – and that is exactly what this innovative partnership delivers.
“Hyde offers institutional investors a complete end-to-end service, from investment structuring through to managing homes and the community around them, with every penny of commercial profit reinvested in building more affordable homes and improving existing homes. With L&G’s long-term capital and our national platform, we can deliver more homes, faster.”
Catherine Raynsford, Managing Director – stock acquisitions, L&G Affordable Homes, said: “Since establishing our affordable housing business in 2018, L&G has built a strong track record as a trusted leader in delivering high-quality, affordable homes across the UK. This new partnership with Hyde marks an exciting milestone, combining our heritage and expertise with an innovative approach that aims to attract institutional investment and accelerate the delivery of much-needed affordable housing nationwide.”
Gareth Mee, CEO of Institutional Retirement at L&G, commented: “The UK needs nearly a million affordable homes, and we face a stark shortfall without collective intervention. As a long-term investor in the UK economy, we have a track-record of deploying pensions capital into resilient, productive assets across the country, as reflected by our £2bn regional growth commitment. This innovative partnership will accelerate the delivery of new affordable homes nationwide, delivering strong, predictable returns to match our pension commitments with long-term investment that makes a tangible impact on local communities.”
