Decision

Previous regulatory judgement: Thrive Homes Limited (26 April 2023)

Updated 13 December 2023

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Thrive Homes Limited
• Regulatory code: L4520
• Publication date: 26 April 2023
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Changed basis for viability grade
• Regulatory route: In Depth Assessment

Regulatory judgement

This regulatory judgement confirms our previous published assessment of Thrive Homes Limited’s financial viability and governance grades (G1/V2) following completion of an In Depth Assessment (IDA).

Based on evidence gained from the IDA, the regulator has assurance that Thrive Homes Limited (Thrive) complies with the financial viability elements of the Governance and Financial Viability Standard and its financial plans are consistent with, and support, its financial strategy. Thrive has an adequately funded business plan, sufficient security and is forecast to continue to meet its financial covenants.

Thrive is increasing investment in its existing homes and continuing to develop new homes, which puts pressure on its financial performance. As a result, Thrive will be reliant on income from sales to meet interest costs in the short term. These factors, in combination with economic uncertainty in relation to inflation and interest rates, reduce Thrive’s capacity to respond to adverse events.

The regulator’s assessment of Thrive’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. Based on the evidence gained from the IDA, the regulator has assurance that Thrive’s governance arrangements enable it to adequately control the organisation and to continue meeting its objectives.

Other providers included in the judgement

None

About the provider

Origins

Thrive is a charitable community benefit society that was formed to acquire the housing stock of Three Rivers District Council in 2008. Its main activities are the development and management of affordable housing.

Registered Entities

Thrive Homes Limited is the only registered entity in the group.

Unregistered Entities

There are four unregistered entities in the group:

• Thrive Places Limited provides housing for market rent;
• Thrive Homes Finance plc established for the purpose of issuing bonds; and
• Building for Thrive Limited and SRJ Homes Limited are both dormant.

Geographic Spread and Scale

Thrive owns and manages around 5,100 homes throughout Hertfordshire, Bedfordshire, Buckinghamshire and Oxfordshire.

Staffing and Turnover

For the year ended 31 March 2022 Thrive’s turnover was £41.1m. It employed 155 full-time equivalent staff.

Development

Thrive plans to develop around 1,000 homes between 2022 and 2027.

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Note: The use of an asterisk (*) against a grade indicates that the assessment refers to a provider that is designated as being for-profit.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.