Legal & General has agreed a GBP40m, 25 year debt facility to Thames Valley Housing Association (TVHA).
Secured by schemes in Hammersmith and Tooting, providing key worker accommodation for Imperial College NHS Trust and St George’s Healthcare NHS Trust respectively, the loan will be used to support TVHA’s ongoing development activity, enabling it to build over 500 new units of affordable housing.
It is believed that this is the first time that institutional finance has been provided to the housing association sector where it has been specifically structured and secured against key worker accommodation.
Formed in 1966, TVHA owns, manages or takes care of loans for over 14,500 homes in London, Berkshire, Surrey, Hampshire, Oxfordshire, Buckinghamshire, Wiltshire and Sussex. These include traditional rented housing, shared ownership, key worker and student accommodation. As part of this, working with NHS Trusts in London and the South East, TVHA currently provides modern, purpose-built, well maintained key worker accommodation to eight NHS Trusts, including Imperial College, St George’s and Nuffield Orthopaedic Hospital in Oxford.
Legal & General has invested over GBP3.5bn in UK infrastructure projects to date and is one of the six UK insurers committed to investing GBP25bn in the UK by 2018.
Jack Stephen, finance director and deputy chief executive, TVHA, says: “The housing crisis is particularly acute in London and the South. By building good quality, new homes and managing them well, we believe that we can significantly grow the social capital of the communities we work in and in turn help to solve the chronic shortfall. When considering our on-going funding requirement we had a range of options available to us. Key to us in working with Legal & General was that they understood the specific objectives we had in raising finance against these particular assets and worked with us to make sure those objectives were met.”
Alex Gipson, social housing lending manager at Legal & General says: “Helping to deepen our investment into the UK’s social housing sector and infrastructure more generally, we were impressed with the quality of accommodation and service delivered by TVHA, and the key relationships developed with the two trusts. This enabled us to understand the strong value and cash generation of the key worker schemes and create a bespoke funding arrangement, thereby meeting TVHA’s specific requirements.”
Centrus Advisors acted as financial advisor to TVHA on the transaction.