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Social housing REIT borrows £70m
The real estate investment trust (REIT) Triple Point has borrowed £70m in a revolving credit facility with Lloyds Bank.
Triple Point, which buys up supported housing and leases it to small housing associations, has borrowed the money on a floating rate, with an initial term of four years that may be extended by another two.
It plans to use the money to continue buying homes, many of which, it said in an update to the stock market, it has already identified.
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Chris Phillips, chair of Triple Point Social Housing REIT, said: “We are delighted to have secured a flexible RCF [revolving credit facility] on competitive terms in order to maintain an efficient balance sheet, enabling us to act quickly on attractive investment opportunities.
“We are pleased to welcome Lloyds Bank as a new counter-party into our relationship group and value their continued support of the UK social housing sector. The level of lender interest we received on this transaction reaffirms the attractive fundamentals of this asset class.”
Triple Point borrowed the money on 24 December, making it the second time it had borrowed money that year.
In February last year, the REIT borrowed from an institutional investor using its assets as security at the same time as it went to the stock market looking for £200m.
At the time, it only managed to raise £47.5m of its target, as social housing REITs struggled in the immediate aftermath of First Priority – a housing association which has struck deals with a REIT and various private equity funds – almost going insolvent.
The market, however, recovered later in the year and Triple Point raised more money from investors in August.
The Regulator of Social Housing is closely scrutinising the activities of some of the housing associations to which REITs like Triple Point and others lease homes.
One of Triple Point’s clients, Westmoreland, was declared non-compliant with the regulator’s standards in November due to “inherent conflicts of interest”.
Two more associations which have struck deals with Triple Point – Encircle and Inclusion – are still under investigation by the regulator.
