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South of England landlord secures £50m green loan for new energy-efficient homes
Vivid has secured a £50m green loan to help it build around 300 new energy-efficient homes, as part of a £110m refinancing deal with Barclays.
As part of the deal struck with the major bank, the 33,000-home landlord has agreed what it called a “green term loan” for £50m over a 10-year term.
All the homes built under the agreement will have an Energy Performance Certificate (EPC) of ‘B+’ or better, the group added.
Vivid manages homes across Hampshire, Berkshire, Surrey and West Sussex.
The green term loan follows the requirements of the Climate Bonds Initiative criteria and the Loan Market Association green loan scheme, Vivid said.
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The interest rate on the loan was not disclosed.
Duncan Brown, chief financial officer at Vivid, said the organisation is “excited about partnering with Barclays to build some of the most energy-efficient homes in the country”.
The deal comes after another agreed by Vivid last month for a 1,000-home venture with Legal & General’s modular housebuilding arm.
Green loans and sustainability-linked loans have become more prevalent in the social housing sector as landlords look to decarbonise stock and build more energy-efficient homes to meet net zero targets.
Investors are also attracted to the sector’s alignment with environmental, social and governance (ESG) principles.
Alongside its green loan, Vivid has agreed a new three-year, £60m sustainability-linked revolving credit facility (RCF) with Barclays, which it said will provide it with “continued working capital”.
The facility is linked partly to Vivid’s commitment to be developing more than 1,000 EPC ‘B+’ or better homes per year.
The new RCF replaces an £80m undrawn facility Vivid had with Barclays, which was close to expiring, and the new package adds £30m to its commitment.
In addition, the Hampshire-based landlord already has a drawn £121.7m loan with Barclays.
In its last full year to March 2022, Vivid reported a 16% rise in group surplus to £72m despite a slight drop in turnover.
The organisation’s total debt currently stands at around £1.5bn.
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