Private developer granted funding from the Affordable Homes Programme

The contract award states that the grant will be used to aid the delivery of affordable homes in the north of the country by Esh Group, the HCA said. It is the first grant of its kind under the AHP that the HCA has awarded to a private developer.

Esh Group will deliver 541 affordable homes across the north east and Cumbria. The grant awarded is in support of contracts valued at over £61m, the developer said.

The contract between the public and private sector organisations is the first of its type to be signed nationally and is one of only two private developer contracts to have be approved to date, according to the HCA. The grant represents almost 6% of the total funding allocated to the north east and Yorkshire.

“It is really encouraging to see central Government investing in this way; placing confidence in and responsibility with regional organisations to get on and tackle issues and challenges within their own areas and come up with solutions for their communities,” said Brian Manning, chief executive of Esh Group.

Of the 541 affordable homes to be delivered under the agreement, 164 will be built in Cumbria and 377 in Northumberland, Tees Valley and Durham. A further 44 units will be made available for the 'Cyrenians vulnerable persons’ facility near to Durham.

Under the contract, Esh Group will make most of the homes available for affordable rent and some for affordable home ownership, supported housing and social rent.

Work will start on the first sites in January 2012 and is planned to be completed by December 2014, according to the developer.

Esh Group led the bid on behalf of a number of regionally registered providers using a specialist subsidiary, Dunelm Acorn Homes, which facilitated consideration of the grant from the HCA.

Esh Group’s partners include Two Castles Housing Association, Livin, Vela, Endeavour Housing and Durham Aged Miners Housing Association. 

Private developers were able to bid for funding under the AHP and have formed a small but important part of the programme, the HCA said.

“This process has demonstrated the good work and benefits of linking public and private sector organisations to increase the supply of new homes. Our investment will ensure that almost 500 additional homes, including 157 in rural communities, are built across the north in the next three years,” said Anne Mulroy, Head of Area at the HCA.