Three Scottish landlords secure £17m through government-backed scheme
Three of Scotland’s biggest housing associations are to receive a total of around £17m in loans to build homes through a government-backed scheme.
The Wheatley Group, Kingdom Housing Association and Link Group are getting the unsecured loans to help build 175 social rent homes between them, the Scottish government said.
Wheatley, Scotland’s biggest social landlord, will receive £7.3m, Kingdom £5.4m and Link £4.4m.
The loans are being provided through the devolved administration’s Charitable Bonds scheme, which has been running since 2014.
Under the initiative, charitable bonds are acquired by the Scottish government from finance broker Allia C&C. Loans with terms of up to 15 years are then agreed between landlords and Allia C&C.
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Interest generated from the loans is converted to charitable donations, which are passed on to other social landlords to help build homes.
As a result of the latest transactions, the Scottish government said total investment through the scheme has passed £500m.
It is the second time that Link Group has benefited from the scheme in the past six months, as it secured £16m last October.
Shirley-Anne Somerville, Scotland’s social justice secretary, said: “We need to use all the tools available to deliver more new affordable homes and help tackle the housing emergency.
“The Charitable Bonds programme has successfully supplemented investment in our affordable housing budget while also allowing social landlords to access additional borrowing to build much-needed new homes.”
To date, the scheme has helped deliver around 4,000 new homes through direct loans to landlords, according to the Scottish government. This has generated £146m to help deliver 1,300 social rent homes, the administration said.
Sally Thomas, the outgoing chief executive of the Scottish Federation of Housing Associations (SFHA), added: “It’s never been more crucial that we deliver many more secure, warm and affordable homes.
“The Charitable Bonds scheme is an important part of doing so, and it’s great to see SFHA members receiving these funds to deliver the homes we desperately need.”
Last September, the Kingdom Group agreed a £50m loan from the Royal Bank of Scotland (RBS) and Bank of Scotland to build around 500 homes.
Eildon Housing Association, based in the Scottish Borders, also announced £18.7m of funding from RBS in January.
