Sapphire housing development case study

Reinvesting in new homes helped us meet local housing need and rebalance our portfolio

Heather Thomas, Chief Executive of Sapphire Independent Housing, spoke to us about how they developed over 100 new homes

We are a smaller registered housing provider originally formed in 1969 as Irish Centre Housing, with a unique selling point of providing housing and services to single people. 

In 2015, we rebranded as Sapphire to better represent the diversity of our residents, staff, board members, and local communities. Currently, we manage 300 homes. Our primary portfolio consists of supported housing and general needs homes, along with a small number of shared ownership and intermediate-rented housing flats. We work in the London Boroughs of Brent, Camden, Islington and Hounslow, and also in Hertsmere in Hertfordshire.

We have an annual turnover of £6m and 42 staff members, most of whom are based at our supported housing schemes.

What Sapphire did

In 2019, we made the difficult decision to sell a 100-bed hostel in Westminster which required modernisation and substantial investment. After careful consideration, we decided that disposal was the best option. The Board wanted to reinvest in new housing to play our part in meeting housing need and rebalance the portfolio to enable Sapphire to continue with supported housing. We decided to try and replace the hostel’s 100-bed spaces with at least 100 new general needs homes. The receipt from the sale was earmarked to provide a subsidy for the development programme, which was also funded by a Greater London Authority grant and a loan.

We brought in development expertise from a consultancy and our programme has been led and managed by a director and project manager, whom we treat as permanent employees and not contractors. This has helped them to understand the organisation and ensure our developments reflect our requirements and aspirations. It has also helped to get the buy-in of the whole organisation, creating a degree of excitement around our growth.

We began bidding for sites in several locations and were successful in securing 16 homes in Camden as part of a Section 106 agreement and 20 council-owned sites in Hounslow. Currently, we have five build contracts and 73 homes on-site in Hounslow and confirmation that the final 39 homes in our programme have grant funding. Our total small sites programme will produce 103 homes.

Overcoming challenges

It has been a long haul. We have been developing in a period of high build cost inflation and higher interest rates have affected our ability to borrow. Some of the planning requirements and conditions have felt quite onerous and we have been impacted by a lack of local authority resources, particularly in the planning department.  

Tariff grant levels in the 2016-2023 Affordable Homes Programme were too low but were better under the 2021-2026 scheme. Small sites have proven to be expensive due to issues with utility connections etc. Overall, we have had to manage the scheme closely because we don’t have the capacity to spread our risk. We recruited development experts to our Board and established a development committee. However, scheme approvals and contracts can only be made at Board level.

We have worked closely with the local authority and they have given us flexibility on land price and timing. We also decided to use smaller to medium-sized contractors and we believe this has helped in terms of their commitment to the programme.  The first handovers are due in January 2025 and by March 2025 we hope to have 64 homes handed over.

We are really pleased with the quality of the new homes, the improvement they make to local areas and the - small but positive - contribution they will make to meeting housing need.