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Welsh housing association secures £50m loan to build 700 new homes
A Caerphilly-based housing association has agreed a £50m loan with insurance company Scottish Widows.
United Welsh, which currently manages more than 6,000 homes, will borrow the money from Scottish Widows at a fixed rate of less than 2.5% over 30 years.
The deal will allow United Welsh to build 700 new homes, bringing the landlord’s total housing stock to more than 7,000 properties across South Wales.
United Welsh, which currently operates in 11 local authorities, has delivered more than 1,000 homes in the past five years and intends to build at least 1,300 in the next five.
The association said the investment from Scottish Widows will allow it to contribute to the Welsh government’s target of building 20,000 new affordable homes by 2021.
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Lynda Sagona, chief executive of United Welsh, said: “At this time of great uncertainty where home has become more important than ever, we are delighted we have been able to negotiate this loan on very competitive terms with Scottish Widows.
“It will enable us to continue with our ambitious development programme, providing much-needed homes for our local communities.”
Grahame Sturges, chair of United Welsh, said: “Having a safe home is of paramount importance to everyone and securing this funding will help us to provide that for many more people.
“It will also mean we can continue to make a valuable contribution to the local economy of South Wales as we develop these homes, which is now more critically important than ever.”
Gavin Reid, associate director at Scottish Widows, said: “We are delighted to have structured a long-term funding solution to support United Welsh’s new build affordable homes strategy, whilst securing high-quality cash flows aligned with our annuity liabilities.
“Being able to complete this transaction during such unprecedented times helps demonstrate our wider commitment to the social housing sector, in which we have now invested more than £3bn.”
Scottish Widows entered the Welsh social housing sector with a £39m loan to North Wales Housing, agreed in October.
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