In 2007 a financial crisis boiled over in the US, erupting into a global economic meltdown the like of which had not been seen since the Great Depression of the 1930s. A key factor was the level of unsecured sub-prime mortgage debt in the States which saw its banks left hopelessly exposed when the property bubble burst.
By 2008 big financial institutions in a number of countries were facing collapse, stock markets tumbled and national governments were forced to step in to bail out major banks. Major economies including the UK’s were thrust into recession with supressed activity in all sectors including the housing and construction sectors over a prolonged period.
Boxing Day 2004 was a wake-up call concerning the power of nature as an earthquake in the Indian Ocean generated a tsunami which killed more than 200,000 people and left a trail of devastation in its wake. The need to respect nature and the impact it can have on infrastructure continues today with flooding becoming a frequent occurrence here in the UK.
Throughout all this Derwent Living retained its commercial focus with 40% of its business made up of commercial activity to fund its core services and businesses. Although increased pressure and restraints on public funding led to a reorganisation of its retirement living services and the closure of Rebecca Court, it weathered the storm, diversified into new markets and even managed to increase its stock.
Changes at the top
During the spring of 2004 Derwent Housing Association was rebranded once more, becoming Derwent Living. This was to reflect the aspirational attitude of the time and increase its appeal to young professionals and students.
It also continued to develop its commercial approach aimed at reducing reliance on diminishing central funding and generating its own revenue to be re-invested in social housing. Already, at the start of this period, commercial activities accounted for more than 80% of its surplus. Student accommodation had already been significant but there had also been increases in market rental and leasehold for the elderly schemes.
By the end of 2004 the staff had expanded to 179 people of which 89 were office staff. But after a long period of stability there were changes to Derwent’s executive team.
In 2007, Tony Blair finally decided it was time to pass the baton of leadership to someone else, and long-serving Chancellor Gordon Brown became Prime Minister. Derwent’s long-term head was preparing to make a similar move. After 28 years at the helm overseeing Derwent’s development, chief executive John Martin decided the time had come to hand over the reins.
On the eve of his retirement John said: “Although I have enjoyed running the company for 28 years I feel it’s the ideal time to hand over to someone younger who can progress Derwent Living’s growth and success and take the organisation to the next level.” He later said that one of his proudest achievements at Derwent was seeing the opening of the 10,000th property.
Peter McCormack became the new chief executive of Derwent Living in 2008. He had already served as chief executive of a housing association based in Acton, London, having started his career in local government at Newcastle City Council.
In 2010 there was a change of chairman at Derwent Living as Suzy Brain England succeeded Duncan Smith following his retirement.
Suzy brought with her a wealth of experience in the housing industry gained during a long and varied career in public life with organisations that brought health benefits and helped people come off benefits into work.
Building new business
In 2009, Derwent Living entered into a joint venture with Bouygues Development to launch Uliving offering residential and other skills necessary to deliver high quality and caring management services for student accommodation.
The two organisations’ unique blend of expertise with experience ensured them financial strength. Uliving is the seventh largest provider of student accommodation in the UK with more than 8,500 student rooms managed from offices in London, Nottingham, Sheffield and Birmingham. Ongoing university partnerships span the country, from York and Sheffield in the North, Nottingham, Loughborough and Leicester in the Midlands to Essex and London in the South.
In May 2010 a Conservative-led coalition with the Liberal Democrats replaced the Labour government and pursued public spending cuts which put huge pressure on public and private sector costs.
Derwent Living recognised the need to outsource its services in order to generate the revenue to sustain its core business of providing social housing. It identified the rapidly expanding facilities management market as one with excellent potential and decided the time was right to branch out once more.
The end result was the launch of Derwent Facilities Management Ltd (Derwent fm) as a subsidiary of Derwent Living. Based in Harrogate, it offers integrated and bundled services, or individual services (such as cleaning, security and maintenance) to suit a client’s needs.
Derwent fm operates across a wide spectrum of clients, providing services for student accommodation, central and local government, the private sector, the health service and education facilities.
Derwent made a ground breaking move in 2005 when it partnered Morley Fund Management, a London-based asset management business, to launch the first UK property fund investing solely in student accommodation. The Beach Student Accommodation Fund was a Limited Partnership and was considered a huge coup for Derwent Living as the first of its type in the UK.
John Martin said of it: “We have been creative and we have shown that we are not just a social housing provider but are open and receptive to new ideas. It is about generating profit which allows us to deliver our core business – that’s social housing – without being totally reliant on grants.”
Derwent Living took over the ownership and management of the properties from Newcastle-based The Home Group. Mainly situated in Derby city, the homes were predominantly affordable-rented with some retirement and shared-ownership properties. The deal also strengthened Derwent’s position as a leading Midlands housing provider.
Sharing the cost of owning
By the time Gordon Brown became Prime Minister in 2007 an average mortgage already stood at more than £100,000 putting it beyond the reach of many whose salaries had failed to keep pace with rising property costs.
Derwent Living was quick to see the potential market and a way to meet the housing needs of those who could not afford to own outright. Shared ownership is a part-buy, part-rent scheme which effectively offered people the chance to buy in stages. For many it offered the best way to buy a home.
The Hub development in the centre of Milton Keynes was a typically popular shared ownership scheme which was given Royal approval when The Queen conducted its official opening.
Listening to what residents have to say
Derwent Living’s first Audit Commission inspection in 2005 gave Derwent a ‘fair’ rating and acted as a catalyst for a number of service improvements. In the years that followed the company made a commitment to listening to what residents had to say and developed a number of innovative ways to gain valuable feedback.
For example, in June 2010 Derwent launched its biggest ever customer call out event lasting a week with more than 100 staff based at its Derby head office taking part including its most senior figures. Chief executive Peter McCormack led by example by joining those phoning customers to gain feedback on services and about the communities where they lived.
In the build-up to the week he said: “It’s so important for us as an organisation to make sure that we keep in touch with people – especially during the downturn when people are often concerned about their rent or other financial issues. This will be a chance for our staff to speak directly to customers to find out exactly what they are thinking.”
Events like the call out week built on Derwent Living’s reputation as a business that listens to its customers and this approach was officially recognised when it was awarded a coveted landlord accreditation by the Tenant Participation Advisory Service (TPAS) after achieving a high score for involving residents in the organisation.
In August 2012 the Derwent Living Resident Scrutiny Team took its own step onto the top of the podium when it gained a Gold Award from the East Midlands Tenant Participation Forum. The award recognised the team’s best practice in resident scrutiny and the positive changes it had made within Derwent.
Its tenant-led scrutiny continues to be praised in the annual Tenant Participation Advisory Service (TPAS) awards and was one of three shortlisting nominations for this year’s awards alongside Derwent Living’s digital engagement and co-regulation.
There was success too for one of its most recent developments when the Oxcroft Lane scheme in Bolsover was included in Inside Housing’s Top 50 UK Affordable Housing Developments of 2013.
The redevelopment of 20 defective bungalows to create 15 new bungalows and 20 new houses involved temporarily rehousing existing residents and the demolition of some homes. It was praised by judges who were looking for affordable and social housing projects that really stood out.
Taxing issue for residents
In 2011 a survey showed that 83% of customers read Derwent Life, the quarterly magazine for residents. More significantly, this was the first survey Derwent Living conducted by text message. More than 500 responses were received in just one hour, and over 1000 in all, proving that text messaging had become a vital communication tool.
Taking advice on the road
A key part of Derwent’s role over the years has been to respond to changes of policy by governments of different political persuasions so that its customers were aware of the potential impact any measures might have on them.
The introduction of the bedroom tax in 2013 affected more than 700 customers who were judged to have more bedrooms than they needed, some of whom stood to lose up to 25% of their housing benefit. Derwent Living worked hard leading up to this to try to alleviate the impact on its residents.
The Resident Involvement team took to the road to visit customers most likely to be affected. Using a mobile home as their office for a week, staff visited 18 different areas and spoke to more than 200 people to inform and advise them about the changes. They also devised an online ‘Bedroom Tax Calculator’ so customers could work out any possible impact on their household.
Three debt prevention assistants were employed to help customers deal with the changes in a bid to avoid rent arrears building up. It prioritised transfer applications from those affected wanting to move to smaller properties and also promoted ‘Home Swapper’, a national mutual exchange programme. This saw a 20% increase in registrations following the introduction of the ‘bedroom tax’.
The immediacy of text and social media is something people have come to expect across the world. Derwent Living embraced modern technologies to help people get in touch at any time of the day or night – and free up normal lines of communications for people who prefer the personal touch.
2012-13 saw the promotion of its social media channels such as Twitter and Facebook, and the launch of both a mobile app for phones and tablets and MY Derwent Living. Embracing the online world means that residents can do things like check rent balances and report repairs at any time.
With MY Derwent Living exceeding expectations – a hope for 300 logins a month exceeded that by 5 times – it was quickly extended with MY Community. Its additional features mean users can hold online discussions with staff and have their say on key topics as well as communicate directly with other residents.
2014 has seen a number of digital projects come to fruition, including a new customer survey platform and the Derwent Live intranet. Development of these services has been moved in-house for a considerable cost saving.
With 76% of its residents using the Internet (above the national average of 64%) and almost 80% of online surveys being completed on mobile devices such as smartphones and tablets, all of their websites, including external payment sites, have been modified or designed to use the latest responsive techniques that adjust to the size of the device being used.
Creating job opportunities
Over the last decade Derwent Living has provided training and employment opportunities for apprentices. Some of the apprentices have come from families living in the organisation’s properties and have gone on to have successful permanent roles within the company and its contractors. Former apprentices Ruth Chisnall and Zack Seals have recently celebrated over ten years as staff members.
Celebrating the past… and planning for the future
Derwent Living, as it is now known, has come a long way since it was formed as The Derwent Housing Association in May 1964. From a small, parochial concern employing just a handful of people out of a small office in The Strand, Derby, it has become a major provider of housing in the Midlands.
Now employing around 750 staff across its group, Derwent Living currently manages more than 25,000 properties across the United Kingdom.
During its 50 years the business has had to deal with sweeping changes in political policy. It has also had to adapt to the changing expectations and desires of existing and potential customers.
It saw sooner than most that previous levels of central funding for housing provision and services were unsustainable. It realised that it had to be a successful commercial operation to be able to fund its core aim – of ensuring as many people as possible from all sectors of the community had access to good quality, affordable homes.
New technologies have been embraced, including new environmentally friendly construction methods and improving communication with customers to ensure that it remains firmly in touch with residents’ opinions and issues.
While striving to achieve the final targets of its existing business plan Derwent Living is already planning its next set of goals for the period 2015-2017.