Magenta Living is the largest registered housing provider in Wirral, owning and managing just under 13,000 properties. The organisation has invested almost £200 million in its properties over recent years and has ambitious plans to build over 800 properties for rent and sale. Whilst focusing on future investments, managing existing property investments is equally important to Magenta Living. In order to manage its stock viability options using net present value (NPV) calculations and neighbourhood insight scoring, they chose MRI Options Appraisal. The focus of the NPV calculations had previously been at a neighbourhood level. A requirement of the Homes and Communities Agency (HCA) is to work at a more granular level.
The need for MRI Housing Asset Management
Previously, Magenta Living held internal reviews to discuss any issues with particular neighbourhoods, but with only limited financial analysis carried out at an individual property level. A decision was made by the Executive team to look into ways of making more accurate and validated investment decisions.
Being a regular attendee of the MRI Asset User Group, the Strategic Asset Manager at Magenta Living had seen an Options Appraisal demonstration. Magenta Living felt that this was the tool that was required by the organisation in order to deliver their business requirements. After putting it forward to colleagues, the Executive team recognised the value that the solution would provide them with, and therefore made the decision to invest in Options Appraisal.
Magenta Living were confident that the solution would provide them with a broader strategic approach to MRI Housing Asset Management and planned to use it to utilise information ahead of their investment plan.
Clear visibility to make informed investment decisions
A year after working with this MRI Housing Asset Management solution, Magenta Living has benefited from being able to identify any poorly performing properties on an individual level. With the ability to carry out financial analyses, the findings can be incorporated into their strategy, helping them to make more informed and evidenced investment decisions, in line with HCA requirements. If a particular block is performing poorly, an appraisal can be undertaken to analyse the effects of selling the properties or converting to market rent or even demolishing and rebuilding. Similarly, they can identify, for example, that areas that are performing well may have higher management costs.
The organisation is now able to look at their budget for the next 15 years with a clearer indication and plan of the investments that they would like to make. Where they have been allocated budgets, they can make more effective decisions on how to retain tenancies and future-proof properties, thereby improving performance and increasing efficiency.
Customer service has also improved as the business is able to provide more of a focus on what they invest in their properties, therefore ensuring a high level of customer satisfaction.
The Strategic Asset Manager at Magenta Living commented, “the implementation of the model with an existing system was so much simpler and smoother than a standalone solution, saving time and manual efforts – it’s just about putting the information in!”
Magenta Living is very pleased with what they have achieved with this solution. The ability to compare different scenarios for the same group of properties is key to decision making in regards to their stock investments. This approach has helped the organisation to set targets for themselves, based on their findings. It has provided the tools to enable them to identify where their focus should lie and to effectively plan for the future. As an existing customer, they have also been able to maximise use of data already held in MRI Asset, therefore saving time and manual efforts.