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Wheatley Group secures £185m EIB loan despite Brexit slowdown

The European Investment Bank (EIB) has signed off a £185m loan to Scotland’s largest housing association, amid concern about delays in the bank’s planned deals with UK housing associations following the Brexit vote. 

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Glasgow, where Wheatley Group is based (picture: Getty)
Glasgow, where Wheatley Group is based (picture: Getty)
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Wheatley Group secures £185m EIB loan despite Brexit slowdown #ukhousing

Wheatley Group announced the £185m deal yesterday at an event attended by Nicola Sturgeon, Scotland’s first minister.

The deal follows concern about a slowdown in lending to UK housing associations from the EIB after the Brexit vote.

The National Housing Federation had called on ministers to act to help speed up the process of releasing loans, and associations had warned homes might not get built as a result of the delays.

The Wheatley deal was agreed with the EIB in September 2016, according to the bank’s list of projects to be funded, but has taken almost two years to sign off.

Deals with a number of other housing associations – including Peabody, Notting Hill, Genesis and Stonewater – are also awaiting completion. Talks over a £420m financing package to Welsh housing associations fell through last summer, with Brexit cited as a factor.

The EIB had promised to meet all of its lending commitments, despite the vote to leave, although it has also warned its involvement with UK housing associations will drop off once the country exits the EU.

The funding will be used as part of a programme to refurbish homes to meet new Scottish and EU energy efficiency standards, and housing and integrating refugees into Wheatley communities.

It will also be put towards Wheatley’s development pipeline, which last year comprised 764 homes including 554 for social rent.

Alastair MacNish, chair of Wheatley, said: “This loan… will help us to consolidate our position as the UK’s largest builder of social-rented homes, which we hold close as a badge of honour at a time when the availability and supply of affordable housing is such an acute priority.”

Jonathan Taylor, vice-president of the EIB, said: “New investment in social housing is crucial to increase the number of affordable homes and cut heating bills in existing properties.

“The EIB supports social housing investment with leading housing associations across Europe and is pleased to back transformational investment here in Scotland.”

Ms Sturgeon described the funding as a “reminder of how Scotland benefits from the EU and its institutions”.

Over the past decade, the EIB has provided more than £4bn for various projects in Scotland, including social housing.

Ahead of the referendum it had provided more than £2bn to housing associations, including lending to 75 small and medium-sized associations through The Housing Finance Corporation – almost half its lending for social and affordable housing in Europe.

After the vote, however, Mr Taylor told Inside Housing “it’s not really feasible to imagine us doing business to the same extent” when the country has left the EU.

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