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Hightown given A3 credit rating by Moody’s
Hightown Housing Association has been awarded an A3 investment grade rating by Moody’s on the back of its stable margins and strong governance.
The rating means the housing association is likely to be able to access more funding sources to finance its plans to build 1,000 homes over the next two years, as a good rating helps investor confidence.
Hightown operates in Hertfordshire, Bedfordshire, Buckinghamshire and Berkshire. It currently manages more than 6,700 homes and provides care and support to disabled and vulnerable people.
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Moody’s report said its rating reflects the landlord’s “strong and predictable operating margins and its simple group structure and focus on tenures with high and stable demand profiles”.
The large development programme, which gives Hightown high leverage, and its debt strategy makes it more risky than some of its peers, but Moody’s said its operating performance is “strong and predictable, despite the high contribution of low margin care and supported housing operations towards its overall turnover”.
Hightown has no exposure to outright home sales, which can be riskier, but it is exposed to “cyclical revenues” through its shared ownership development programme.
More borrowing or scaling up of development, as well as a lack of support from the government for housebuilding, could push the rating down in future, Moody’s said.
David Bogle, chief executive of Hightown, said: “We’re delighted that Hightown’s reputation for strong financial management has been reflected by this investment rating.
“There is a huge demand for affordable housing and increased investor confidence means we can continue to build hundreds of high-quality homes to people who cannot afford to rent or buy at market rates.
“This includes providing homes and support for the growing number of people sleeping rough and children and families living in temporary accommodation.”
