The local authority for the City of Westminster in Greater London has secured £235m (€274m) in financing from Macquarie Asset Management, acting on behalf of Phoenix Group, to acquire over 350 temporary accommodation properties from A2Dominion.
Westminster City Council (WCC) has obtained the 42-year inflation-linked loan for the acquisition of the properties within the borough.
Gareth Edwards, SVP at Macquarie Asset Management, said: “The City of Westminster faces a significant demand on temporary accommodation as it continues to address homelessness in the City. This transaction enables the transfer of a considerable number of properties from a leading social landlord to WCC, who has become the first London local authority to achieve the strongest customer rating of C1 from the social housing regulator.
“We are pleased to support WCC through this financing solution that will secure longer-term tenancies for vulnerable individuals in a cost-effective manner, and at the same time providing Phoenix with a long-term inflation linked stable cashflow.”
Oliver Swallow, senior investment manager at Phoenix Group, said: “Tackling systemic social issues like affordable housing is fundamental to our investment philosophy, as not only does it provide robust financial returns for our customers, but it also drives to the heart of our social purpose.
“This long-term, low-cost public-private financing initiative will provide stability to Westminster residents impacted by either unaffordable, unsuitable or unsafe housing, and grows our social and affording housing investment portfolio to £1.5bn.”
Gerald Almeroth, executive director of finance resources at Westminster City Council, said: “Like many Councils in London, Westminster is experiencing significant increases in homelessness demand and costs. This acquisition helps to protect much needed quality temporary accommodation supply within the City.
“This innovative financing structure will help the council secure and improve these housing assets for the long-term benefit of our residents.”
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