UK affordable housing developer Bromford has partnered with NatWest on a new £200 mln (€263 mln) loan.
This sustainability-linked financing will support the construction of 1,300 new affordable homes in the West Midlands and West of England.
The loan is split into two tranches maturing in 10 and 11 years. The loan offers reduced interest rates if Bromford meets targets for delivering new social housing and lowering their carbon footprint (Scopes 1, 2 & 3).
This funding aligns with Bromford's commitment to sustainable development and is their seventh issuance under their Sustainable Finance Framework. Over the past year, Bromford has secured more than £650 mln (€768 mln) of sustainable finance.
Bromford last year completed 1,191 new homes, including 308 for affordable rent and 551 for social rent.
Bromford’s director of Treasury, Imran Mubeen, said: ‘NatWest have been one of our key strategic funding partners for several years. We had considered a return to the capital markets this year, but we continue to refresh and optimise our new funding strategy in view of prevailing market conditions. Importantly, the loan has the potential to generate over £1 mln of interest savings if we successfully meet our sustainability targets.’
Amanda Swann, Bromford’s director of development, commented: ‘With demand for affordable housing showing no signs of decreasing, we are committed to playing our part in tackling the housing crisis by continuing to build affordable homes. This loan from NatWest will allow us to continue our development programme to meet our ambition of building 11,000 new homes by 2032 with 65% at social and affordable rent tenures.;
Paul Eyre, head of Residential and Housing Finance at NatWest Group, added: ‘We announced an ambition earlier this year to provide £5bn (€5.9 bn) of funding commitments to the social housing sector to December 2025. This additional funding brings our progress against this to £1.7 bn.’
Legal advice was provided by Devonshires, Clarke Willmott, and Trowers & Hamlins acting on behalf of Bromford and Addleshaw Goddard acting on behalf of NatWest.
