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Large Midlands landlord secures £275m in ESG-linked loans
Platform Housing has agreed £275m in ESG-linked loans with two major international banks, one of which is a new lender to the group.
The 50,000-home association has borrowed £175m from National Australia Bank (NAB) and £100m from ABN AMRO Bank (ABN). Both loans have a five-year tenure, with the option to extend to seven years.
It is the first time the landlord has taken finance from Dutch bank ABN, a spokesperson told Inside Housing.
The NAB loan is a refinancing of an existing £100m facility, which has been increased and converted to an ESG-linked deal.
The borrowing comes nearly two years after Platform took a £235m sustainability-linked loan with Lloyds Bank.
The new funds will be used to help Platform build more homes and boost the energy efficiency of its existing stock, the landlord said.
In its half-year results, announced in December, the group revealed that spending on its current homes had jumped 50% to £14.1m.
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Under the terms of the loans, Platform will get a reduction in interest rates if it hits various targets.
The key performance indicators are linked to increasing the energy efficiency of its existing stock and new homes, plus “improving Black and minority ethnic colleague representation, relative to demographics of the operational areas of Platform and national averages”, the group said.
The basic rate on both loans is variable, linked to SONIA (Sterling Overnight Index Average). The index reflects the average of interest rates that banks pay to borrow sterling overnight from other financial institutions and institutional investors.
Rosemary Farrar, chief finance officer at Platform, said: “We are in the midst of an acute housing shortage across the country and we’re committed to play an active role in being part of the solution.
“That means developing and improving homes that are both fit for purpose and fit for the future. These new loans allow us to partner with existing and new relationship banks in putting our customers first and delivering social and environmental benefits.”
As a result of the loans, Platform has total debt of £1.9bn.
In its most recent half year, the landlord reported a 10% drop in post-tax surplus to £28m, mainly due to lower surpluses on fixed-asset sales. Platform currently has a G1/V1 rating with the regulator.
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