Black Country Housing Group (BCHG) has sealed a £60m financing deal that includes its first private placement and also an extended debt facility.
The funding package – arranged with support from Savills Financial Consultants – will underpin the delivery of the Black Country-based housing association’s business plan objectives, including building 261 homes by March 2025.
The deal for the 2,200-home landlord includes a £40m private placement, which is available in three tranches from this September and then April 2022 and April 2023. The average cost of the funds with the unnamed investor is 2.83% and the term is 30 years.
Santander has extended its existing £20m RCF (revolving credit facility) with BCHG. This is one of the first deals Santander has struck in the housing sector using the SONIA index as opposed to the more traditional LIBOR – use of the latter is being phased out.
Kaye Coulthard, Director of Finance at BCHG, said:
“BCHG is delighted to have secured £60m of new facilities, which will enable us to provide much-needed investment in affordable homes in Birmingham and the Black Country. We very much look forward to building upon our strong relationship with Santander and our new investor, and would also like to thank our advisors, Savills Financial Consultants and Anthony Collins Solicitors.”
Sean Escott, Director at Savills Financial Consultants, said:
“It is really pleasing to have helped Black Country put this package together. The ongoing support from Santander is great news and provides important continuity.
“Securing BCHG’s first private placement is another significant aspect to this deal. Not only does this give the certainty needed to deliver BCHG’s business plan in the coming years, but it demonstrates the level of investor interest that now exists to work with housing providers right across the country.”
Roy Cavill, Relationship Director at Santander, said:
“It has been a pleasure to play our part and help BCHG secure this funding package. This is a key milestone for BCHG’s business plan and commitment to deliver affordable housing in Birmingham and the Black Country. Santander truly values its long standing relationship with BCHG and the extended SONIA linked RCF (revolving credit facility), which is one of our first in the sector, brings flexibility and modernisation to BCHG’s funding structure.”
Natalie Singh, Partner at Anthony Collins, said:
“We were delighted to work with Black Country Housing Group to provide support in securing this £60m funding package. It enables BCHG to fulfil its ambition to build more than 260 homes for its customers and to invest in its existing housing. This is the first private placement for BCHG and it is wonderful to see the positive financial outcome both for BCHG and its customers and communities.”
Funders: Unnamed investor (£40m private placement); Santander (£20m revolving credit facility)
BCHG’s Financial Advisor: Savills Financial Consultants
BCHG’s Legal Advisor: Anthony Collins
Funder Legal: Addleshaw GoddardValuer (private placement): JLL