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North East landlord secures £80m of debt facilities from insurance firm
North Star Housing Group has received £80m in debt funding from insurance giant Pension Insurance Corporation (PIC) following a recent restructure.
North Star, which owns and manages around 4,000 homes in North Yorkshire and County Durham, received £70m in spot funding and £10m deferred funding to be draw down in 2022, with both deals maturing in 2060.
A spokesperson for PIC told Inside Housing that rates on the deals are not being disclosed publicly.
The investment will be used to refinance North Star’s existing bank facilities, build 600 news homes and improve the energy performance of its existing stock portfolio.
Last month, North Star underwent a group restructure, transferring all its engagements to Endeavour Housing Association on 2 November, with Endeavour changing its name to North Star Housing Group on the same day.
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James Walder, executive director of finance and business support at North Star, said: “The completion of the treasury and group restructure is an important milestone for North Star Housing Group.
“We have a clear strategy to both invest in our existing assets and develop new homes. Delivering on our treasury strategy in these highly uncertain times has been a real achievement for North Star Housing Group and we look forward to delivering our ambitious plans for the future.”
PIC said the maturity profile of the deals has been tailed to match its pension liabilities in year where it is difficult to source cashflows in the public bond markets.
Eugenia Korobova, debt origination manager at PIC, said: “PIC’s funding in North Star, allowing it to develop hundreds of new homes, and in the housing association sector more generally, plays an important part in backing the pensions of our policyholders as we look for secure and reliable income streams over the long term.
“The pension risk transfer market is expected to play an increasingly important role funding social housing over the coming decade as we take on more pension liabilities.”
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