Large landlord issues £250m bond to fund affordable and sustainable homes

News08.04.244.30 PM by Grainne Cuffe

A large housing association in the Midlands has issued a £250m bond to fund the development of new affordable and sustainable homes.

Crane installing modular wall panels at a housing development

Wall panels being installed at a Platform Housing Group development in London Road in Kirton, Lincolnshire

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A large housing association in the Midlands has issued a £250m bond to fund the development of new affordable and sustainable homes #UKhousing

The bond is Platform Housing Group’s second sustainability bond from its £1bn Euro Medium-Term Note (EMTN) programme.

Platform, which owns and manages more than 49,000 homes, said the £250m bond has a 26-year maturity and was priced at government gilts plus 0.83%, producing a coupon and yield of 5.3%.

Proceeds will be used in accordance with Platform’s sustainable finance framework to fund the development of new housing that qualifies as ‘green buildings’ – having an Energy Performance Certificate (EPC) rating of Band A or B – and ‘affordable housing’, homes developed for those who are unable to access the private housing market.

The landlord said there was “significant” demand for the transaction, with initial order books just under four times oversubscribed and more than 50 investors participating.

Jessica Friend, group corporate finance director at Platform, said: “The strong performance of this issue is supported by our ongoing engagement with the debt investor community and reflects Platform’s focus on balancing investment with maintaining financial strength.

“The proceeds will be used to help fund the provision of more much-needed quality, affordable and sustainable housing as we continue to alleviate the housing shortage across the region.”

Ben Colyer, corporate treasury director at Platform, said: “The transaction will complement the £275m sustainability-linked revolving credit facilities arranged earlier in the year and means that just under half of Platform’s £2.2bn debt portfolio is now explicitly supporting our sustainability objectives.”

Rosemary Farrar, chief finance officer of Platform, said: “We are incredibly pleased that our debt investors recognise the huge attractiveness of the social housing sector and continue to support funding the excellent projects we invest in.

“These investments help to make significant social and environmental improvements to the communities in which we operate, as we push ahead with our ambitious development and decarbonisation strategies.”