UK housing association Karbon Homes has successfully restructured its debt and secured new funding, thanks to the support of Savills Financial Consultants.
Karbon has renegotiated improved terms on £235 mln (€279 mln) of its funding facilities, including significant interest cost savings with margin optimization, with four existing lenders, including NatWest, Lloyds Bank, Santander UK and the private placement investor.
This includes a new 10-year, £54 mln (€64 mln) loan from NatWest, which will save the housing association over £3 mln (€3.6 mln) in interest.
Scott Martin, executive director of Resources at Karbon Homes, said: ‘We're very pleased with the result of this recent financing review, which will ensure our investment in our existing homes, our commitment to building new, affordable homes, and our continued delivery of valuable work across communities, is supported by our funding structures.’
George Flynn, director at Savills Financial Consultants, commented: ‘We are really proud to have supported Karbon through these critical negotiations in order to optimise and simplify its financing structure and to unlock significant financial capacity.’
Andrew Thompson, assistant director, Treasury at Karbon Homes, added: ‘The collaboration with SFC on this has been outstanding. The team have been responsive, delivered reports and analysis and worked closely with our board and management team to deliver an excellent set of outcomes.’
As a result of these financial maneuvers, Karbon said it is well-positioned to deliver the commitments outlined in its 2024-2029 Stronger Foundations strategic plan that includes maximizing investment in both existing and new homes.
Karbon Home’s footprint covers the North East of England and Yorkshire, with over 32,000 homes owned and managed. The company is a Homes England Strategic Partner with £165 mln (€196 mln) grant funding to help deliver 2,200 new social and affordable homes to 2026.
Karbon Home’s low-risk business model focuses on core social housing and low exposure to market sales risks. Turnover form social housing lettings represents 87% of total group turnover of £191 mln (€227 mln) for the financial year to 31 March.
The Newcastle-upon-Tyne-based housing association completed 644 homes in 2023/2024, up from 529 last year.
