You are viewing 1 of your 1 free articles
Aggregator completes fourth deferred deal at its lowest rate yet
Social housing bond aggregator Blend has completed its fourth deferred transaction in two months, at what it said was its lowest rate for this product type.
Blend, which is part of The Housing Finance Corporation, priced the transaction at £25m for Newport City Homes (NCH), at an all-in rate of 2.17%, with a spread of 134 basis points (bps) over gilts – the cost of government borrowing.
It brings the total deferred issuance in Blend to nearly £150m for four borrowers, all of which benefited from cost of funds at 2.26% or tighter for 34-year fixed-rate borrowing.
The funding will support the 9,600-home NCH with its plans to build more than 1,000 homes over the next five years.
NCH is Blend’s third borrower in Wales, with Blend stating that further issuance is expected on behalf of Welsh housing associations as part of its 2021 pipeline.
READ MORE
Blend said there has been sustained demand for its issuance, despite volatility in the markets due to uncertainty surrounding Brexit negotiations.
This reflects investors’ continuing faith in housing associations as an attractive long-term investment, the aggregator said.
Stephanie Bradley, director of finance and resources at NCH, said: “As part of our Strategy 2025, we’re committed to building over 1,000 new affordable homes in the next five years.
“Through Blend’s deferred product, we’ve been able to secure our future funding needs while locking in a fantastically low rate. This will support us to realise our 2025 ambitions, and continue to provide quality housing for our residents and communities.”
Blend CEO Piers Williamson said: “This transaction brings to a close a really busy period for Blend.
“Right now, we have issued getting on for £500m under the Blend programme so far this year and expect to be pushing our first billion of issuance by our financial year end next March.
“Our focus through the uncertainty of the US elections, COVID and leaving the EU has been on working with new core investors that are interested in ESG and especially the benefits that housing associations can bring to their local communities in these unprecedented times… and as someone whose mum was born in Newport, there’s a particular resonance for me in helping deliver fantastic outcomes there.”
Sign up for our development and finance newsletter
Already have an account? Click here to manage your newsletters
