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Aggregator taps £1bn bond at 2% for three housing associations
A major social housing aggregator has tapped one of its £1bn-plus bonds to raise nearly £20m for three community-based housing associations at a rate of just over 2%.
The Housing Finance Corporation tapped its THFC Funding No 3 bond at a rate of 2.01%, raising funds for Unity Housing Association, Pickering and Ferens Homes, and Croydon Churches Housing Association (CCHA).
The tap, which was three times oversubscribed, was achieved at a rate of 135 basis points over gilts.
According to THFC chief executive Piers Williamson, the issuance was “targeted at a small number of community-based associations” and by working through the THFC Funding No 3, the associations could access finance at the same rates as their larger counterparts.
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CCHA, which owns and manages more than 1,400 homes across three London boroughs, secured £7.5m through the tap. The money will go towards its development programme, which is intended to deliver 50 affordable homes per year up to 2025.
Unity, which is based in Leeds and focuses on meeting the needs of BAME communities in the city, secured £7.5m and will use it to support new affordable housing developments in Kirklees.
Pickering and Ferens Homes, which is a housing association for older people that has 1,500 homes in East Yorkshire, accessed £4.5m to fund the construction of 80 affordable homes over the next two years.
Mr Williamson said: “We are delighted to be providing funding to these three organisations.
“They each provide targeted and invaluable support in a unique way and demonstrate collectively the vital role associations play in binding communities together.
“As we enter tough economic times, their role has never been more important, and today’s transaction goes right to the heart of what THFC is all about.”
