Legal & General agrees £100m loan deal with Hyde
Published by Max Salsbury for 24dash.com in Housing and also in Finance
Legal & General (L&G) has injected £102m into the social housing industry, its first loan to the sector.
The 15-year deal to The Hyde Group is structured as separate loan agreements to two of Hyde's subsidiaries. Hyde SouthBank Homes Ltd and Hill Housing Trust Ltd have been provided with loans of £61m and £41m respectively.
Both loans are secured and are set at a fixed rate for their duration.
L&G announced its intention to enter the social housing sector last year.
The firm hired Alex Gipson in January, a social housing expert who had been with the Royal Bank of Scotland for 27 years.
Mr Gipson, L&G's social housing lending manager, said: “The very nature of an insurer’s long-term pension and life insurance liabilities provide much closer alignment with the borrowing desires of the housing association sector. The housing need is not only an incredibly pressing one today, but stretching far into the future, and Hyde is a strong, long term operator with an inspirational and dynamic approach, which recognises that its funding provisions have to match its business profile."
L&G believes it can fill the gap left in the market for housing associations that want to borrow smaller amounts by providing bi-lateral loans, down to as low as £25, and more bespoke solutions than the capital markets or banks are able to provide.
Simon Peacock, Hyde's group finance director, said: “We are delighted to have secured these loans, which will enable us to continue our momentum in making a lasting difference to housing availability in key locations. We were very pleased by the options offered to us by L&G, which enabled us to take advantage of favourable all-in costs of financing available in today’s capital markets and for a duration which matches the long-term nature of our business. We look forward to a long and productive relationship with them.”
Hyde manages around 49,000 properties in London and the South East.
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