Macquarie Infrastructure Debt Investment Solutions (MIDIS) and MUFG Bank (MUFG) are providing £150m (€167.6m) debt financing to help a west London-based housing association grow its development pipeline.
MIDIS and MUFG have given Shepherds Bush Housing Association (SBHA) with the long-term debt facility in the form of a three-year revolving credit facility (RCF) of £30m, a 40-year senior secured private placement of £50m that refinances the RCF, and a shelf facility of £100m.
The funding will allow SBHA to boost its affordable and shared ownership housing provision.
Gareth Edwards, an associate director in MIDIS, said: “Increasingly local housing associations are looking for alternative strategies to help meet longer-term funding requirements to support further investment, which is where institutional investors come in.
“The social housing sector is highly attractive to many investors because it offers long-term, secure, regulated and stable cash flows, and delivers a strong social impact.”
Sanjay Narbheram, a director of housing finance at MUFG, said: “We see growing interest within the sector from a debt capital markets perspective, and this deal is a wonderful example of MUFG’s desire to work more closely alongside institutional investors.
”The sector continues to grow in importance for MUFG as we start to widen our client base, from both a geographical and unit number perspective.”
Mohit Jain, a director of finance and development at Shepherds Bush Housing Association, said: “We are aiming to significantly expand our development pipeline over the next few years and are very pleased with the financing achieved with MIDIS, who has taken a long-term outlook on our business, and shown flexibility and willingness to listen to our funding needs.”