A clerk’s perspective: Building homes with ethical loans

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Almshouses have been serving communities for hundreds of years – long before ‘affordable housing’ became a buzzword. Clerk Michael Siggs tells us about the loans process for building new homes and his experience with Charity Bank.

Michael Siggs was a regional clerk with the National Almshouse Association for 25 years and now administers 10 almshouse charities across Essex and Cambridge. One of these is Winnocks & Kendalls Almshouses in Colchester, which redeveloped 7 dilapidated bungalows into nine modern flats, with the help of an £800,000 ethical loan from Charity Bank.

Can you tell us a little about the project?

We’ve been working to modernise our almshouses over a number of years, including replacing bedsits with flats and building a common room for residents. We were left with the last phase of the development – seven bedsit bungalows, built in the 1920s/1930s. They were well past their sell by date, and we had difficulty letting them out.

We wanted to redevelop the bungalows into flats, but they’re adjacent to a terrace of two storey of Grade I listed almshouses, so we had to consult with English Heritage. That took a year and it was another two years before we got planning permission.

And where are you now?

We're delighted that the scheme eventually completed in November 2019. Residents started moving into the units from October 2019. And things have gone very well. These are lifetime homes, with level access and lifts to make them wheelchair accessible, as well as WiFi, digital phones and a link to a 24-hour careline. We've recently been nominated for an Almshouse Association award because of the development.

Could you have built the flats without a loan?

No. We sold some of our housing stock but put that money towards the earlier redevelopment work. We had about £300,000 left in our kitty when we first started planning this latest phase. The estimated cost of the new flats was £1.4 million. We agreed a loan of £800,000 from Charity Bank and went to the local council to see whether they could help us. They agreed to support the project with a grant of £500,000.

Did you speak to any other loan providers?

We worked with a highstreet bank on the earlier redevelopment work back in the 80s and 90s, but they’ve withdrawn from this form of lending. I don’t think any other bank would help us to be honest, as most have also withdrawn from this market. Charity Bank has been fantastic. Carolyn Sims [Director of Lending] is a treasure. She’s been so supportive. An absolute star.

How did you find the loan process?

Charity Bank was always there, always supportive. They listened to what we needed and helped with all the necessary dotting of the Is and crossing the Ts and making sure we complied with all the regulations. We've learnt a lot and we're so, so grateful.

Charity Bank also helped to make sure that we had the right consultants available to give the necessary safeguards to the bank and to ourselves.

Michael Siggs

Did that help to reassure your trustees?

Trustees are the salt of the earth. They freely give their time to the Charity. When we put pen to paper and signed the contract, the trustees needed to know that we weren’t going to run into trouble, which would put the charity at risk. We’re giving homes to vulnerable people and they need security.

Did you come up against any challenges during the loans process?

We had various planning issues. For example, there was a drain running along the edge of the site, which was not declared on any Anglian Water plans. We originally wanted to build 12 flats, but for various reasons we had to scale down our plans to nine homes.

Is there anything you wish you’d know about the loan process that you do now?

It took three or four months after the loan was agreed before the solicitors acting for Charity Bank completed all their procedures. The contract we had with the contractor needed to be signed within a month. That gap gave me a terrible headache.

You work with a lot of almshouses in the area. What other projects do you have coming up?

This experience has given us the confidence to go ahead with more developments. We’re planning to build another 31 almshouses. We’ve got to the final stages of planning and hope to get final planning consent in October. We hope to get the maximum grant from Homes England and are looking to get a loan from Charity Bank for the rest.

About Charity Bank

Charity Bank is the loans and savings bank owned by and committed to supporting the social sector. Since 2002, we have used our savers’ money to make more than 1000 loans totalling over £350m to housing, education, social care, community and other social purpose organisations.

Find out more about us here.

Nothing in this article constitutes an invitation to engage in investment activity nor is it advice or a recommendation and professional advice should be taken before any course of action is pursued.