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US banking giant Wells Fargo enters UK sector with £50m Hyde loan
US banking giant Wells Fargo has struck its first deal in the UK social housing sector with a £50m loan to landlord Hyde.
The San Francisco-headquartered multinational, the US’ largest commercial property lender, made its first big foray into the UK property market in 2013 and is now targeting the social housing sector.
John Langley, regional president for Europe, Middle East and Asia (EMEA) at Wells Fargo, said: “Affordable housing finance is a key product line for Wells Fargo in the US and we are looking forward to expanding our footprint to the UK.”
The American bank will join an existing club loan that Hyde has with BNP Paribas and Allied Irish Banks. Asked by Inside Housing what the rate is on the £50m loan, a Hyde spokesperson declined to disclose it and said the information was "confidential".
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Hyde said at the time that it signed the £150m, seven-year club loan last year it was looking to add other lenders in.
Club loans or ‘syndicates’ have been relatively rare since the 2008 financial crisis. They are intended to diversify risk by spreading the funding between several lenders.
Anna Wallace, treasurer at Hyde, said: “The substantial interest that Hyde has had from our investors in our debt-raising activities has demonstrated the support and positivity that lenders see in Hyde and the wider sector.
“The basis of the club deal puts all investors on the same terms which makes the funding quick, easy and cost effective to execute and maintain.”
The 50,000-home association, which also has a 10-year £200m loan from NatWest, said the deal is part of its five-year development programme which has been stress tested by the Bank of England.
In its last full year, Hyde bucked the trend among its peers by reporting a sharp jump in surplus as its revenue from market sales more than tripled. The group explained its focus on commuter towns for development had helped it to drive sales and avoid the slowdown in central London.
Last year, Hyde promoted finance boss Peter Denton to be its new chief executive. And last month it appointed former Crest Nicholson interim finance director Rod Holdsworth as its new chief financial and resources officer.
