Bromford, one of the largest housing associations in the South West, has secured £50 million private placement from a single UK investor.
It means the housing provider has passed the half a billion pound mark since completing its two mergers with Merlin (last year) and Severn Vale (In January); raising £550 million of new funding through the banking and capital markets in that period. The organisation has grown to one with 44,000 homes and the funding will be used to deliver its ambitious new homes programme of 13,000 homes by 2028.
The eight-figure finance package has a 14-year maturity and was finalised on a deferred basis for 12 months allowing the housing association, which has offices in Cirencester, Tewkesbury and Chipping Sodbury, to leverage historically low gilt rates and lock in the price amidst continuing political and economic uncertainty.
The deal comes off the back of its annual investor update in May which led to a significant level of reverse enquiries from investors. Bosses said the high level of interest reflected “continuing strong investor confidence” in the housing association which has thousands of homes across Gloucestershire and South Gloucestershire.
The news comes after Bromford’s £300 million debut public bond; £100 million inaugural North American private placement; £100 million revolving credit facility with Lloyds Bank; and the £50m private placement concluded today. The funding will be used to build more than 1,000 homes every year across its operating area.
Imran Mubeen, Bromford’s head of treasury, said: “Our strong financial performance is something we are proactively seeking to maintain as we continue to invest significant funds into new homes. With potential instability in the financial markets ahead, this funding gives us additional certainty of being able to deliver our development aims for future customers.
“The high volume of interest from investors is testament to the strength of the Bromford proposition and we look forward to working closely with our partners going forward and forming new relationships with investors where it makes sense to do so.”