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Birmingham-based landlord raises £100m in retained bond sale
Midlands housing association Longhurst Group has raised £100m through a bond sale, and plans to use the money to invest in building 750 homes annually.
The company sold 2,043 retained bonds, which it had originally issued via a funding vehicle in 2018.
The bonds were launched last week following a series of investor meetings. According to Longhurst, the sale was four-and-a-half times oversubscribed and achieved an all-in re-offer yield of 2.34%. This was 1.5 percentage points more expensive than the cost of equivalent government borrowing.
The housing association attributed the heightened interest to its work on rent arrears, tenancy sustainment, development and shared ownership sales, combined with its work to help tenants.
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It is one of the largest housing groups in the Midlands and the East of England, providing more than 23,000 homes across 50 local authority areas.
Rob Griffiths, deputy chief executive and chief financial officer at Longhurst, said: “Having such strong foundations is something we can all be proud of as it will help us continue as a leading housing group and developer while investing in our communities and enhancing our services to do everything we can to improve people’s lives.”
He said that the sale of the bonds provides the group with further liquidity to realise its development ambitions and build around 750 new homes a year between now and 2025.
“As illustrated by the level of investor appetite, as well as the recent retention of our G1/V1 status, our strong financial footing – alongside strong governance and a robust approach to managing risk – provides the solid foundations that will enable us to realise our future ambitions,” Mr Griffiths added.
Last year, Longhurst consolidated its structure into a single entity, joining its parent company with its four subsidiary housing associations: Friendship Care and Housing, Longhurst & Havelok Homes, Spire Housing, and Axiom, with which it initially merged in 2017.
