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Could the new Community Ownership Fund benefit community-led housing groups?

12 April 2021

Community groups will be able to bid for funding from June 2021, to help rescue local community assets at risk of being lost.

The purpose of the new £150 million Community Ownership Fund (the ‘Fund’) is to help communities across the UK with the preservation of assets and amenities that form part of the social fabric of a community.

From summer this year, community groups will be able to bid for up to £250,000 matched funding to help them buy local community assets at risk of being lost. The intention is that the community group would then continue to own and operate the asset as a community-owned business.

There will be no definitive list of assets that a group can bid for and funding may be given for projects in relation to community-owned sports clubs, sporting and leisure facilities, cinemas and theatres, music venues, museums, galleries, parks, pubs, post office buildings, and shops.

In certain cases, the funding limit may be increased to up to £1 million where the funding is to be used to help establish a sports club or sports ground and, in most circumstances, bids should be made from community groups with formal governance in place.

So, could the Fund benefit community-led housing groups?

A community-led housing project can be led by a variety of different community groups, under a variety of different governance structures. That being said, a very common structure is a Community Land Trust (‘CLT’). 

A CLT is a legal entity set up by communities with the overarching aim of providing and managing assets in a way which benefits a local community. Whilst the primary concern of a CLT is often the development and management of genuinely affordable housing, many CLTs run community businesses in addition to their other activities, with the wider aim of supporting and sustaining the community at large.

Indeed, we are seeing a general trend of community-led housing projects engaging in activities beyond the confines of housing provision.  This new Fund will be of interest to all such groups. By identifying and acquiring an asset which could be used for community-owned business activities, a community-led housing group could widen the positive impact of its activities and strengthen the social foundations of the community. 

Of course, any such activity will carry its own risks.  A community-led housing group will need to be sure that such activities are in the organisation’s best interests and that there is sufficient knowledge and experience among board members to oversee them.  Charitable community-led housing groups will need to take particular care, to ensure that such activities are permitted by their charitable objects.  Where this is not the case, it may be possible to do such activities through a trading subsidiary, although this is a complex area of law and we would recommend that you take legal advice before doing so.

Detailed guidance on eligibility criteria, how bids will be assessed and weighted, and how to develop a strong bid will be provided in the full bidding prospectus, due to be published by June 2021. However, if you are interested in setting up a new legal structure to bid for the Fund, discussing whether your existing legal structure might be permitted to undertake Fund-eligible activities or in community-led housing generally, please do get in touch.

If you would like to discuss any aspect of community led housing further, please contact Laura MossMichael Wilcock or any other member of the dedicated Community-led housing team on 0113 244 6100.

You can also keep up to date by following Wrigleys charities team on Twitter here

The information in this article is necessarily of a general nature. Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors.

Laura Moss View Biography

Laura Moss

Partner
Leeds

Michael Wilcock View Biography

Michael Wilcock

Trainee Solicitor
Leeds

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