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Major London landlord secures £250m loan through bond aggregator
Metropolitan Thames Valley (MTVH) has agreed £250m in new funding from a bond aggregator to boost its development plans and invest in its existing homes.
Metropolitan Thames Valley (MTVH) has agreed £250m in new funding from a bond aggregator to boost its development plans and invest in its existing homes #UKhousing The 57,000-home landlord has raised the funds through Blend, a subsidiary of The Housing Finance Corporation (THFC). It is the first loan MTVH has agreed through Blend, but it has previously used THFC to borrow around £65m.
Ian Johnson, MTVH’s chief financial officer, who is retiring this autumn, said the new loan will “back our strategy to build more affordable homes and continue to invest in our existing estate”.
In unaudited results published this week, the G15 landlord revealed that its completions fell by 39%, to 544, in its last financial year.
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However, the group still has 4,970 homes in its five-year development pipeline and is targeting 1,000 completions a year. MTVH also reported a return to surplus after falling to an £80.3m deficit the previous year.
MTVH’s loan from Blend was secured after the aggregator raised £260m through a new seven-year bond.
Leeds Federated Housing Association, which operates around 5,000 homes, has taken the remaining £10m from the bond as a loan. The landlord, which has previously borrowed £20m through THFC, will also use the new funds to build homes and improve existing stock.
THFC said the bond achieved an all-in spread of 100 basis points over gilts, and a yield of 5.26%.
The aggregator also raised £150m in retained bonds, which it said will allow it to “quickly access markets” for other housing associations.
Will Stevenson, group treasurer at THFC, said: “We are really pleased to be able to open up the shorter end of the market for housing associations and sterling investors. The £150m of retained bonds will allow us to rapidly respond to reverse enquiries from investors.”
In February, THFC announced it had teamed up with the government’s National Wealth Fund to retrofit affordable homes. The tie-up has an initial £150m backing from Rothesay, the UK’s largest pension insurance specialist. London-based THFC currently has a loan book of around £8bn.
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