Friday 13 January 2006
Deal to fund thousands of new homes

BPHA, one of the country's top-performing housing providers and developers, has signed a major refinancing package that will deliver thousands of new affordable homes.

Bedfordshire-based BPHA chose to remain with its existing syndicate of five lenders to borrow £217 million of new money, bringing its total sum to £500 million.

As a preferred development partner of the Housing Corporation working across major growth areas, the money will be used to fund a wide-ranging programme of new development, both in Bedfordshire and across the east of England including Cambridgeshire and Milton Keynes.

The deal, with lending syndicate Abbey, Barclays, HBOS, Nationwide and Royal Bank of Scotland, means BPHA now has the resources in place to deliver on its plans to build 1,000 new homes a year over the next five years.

BPHA Chief Executive John Cross said: "The refinancing puts us on an even sounder financial footing for future growth and will enable us to meet our corporate objectives to build 1,000 new homes a year

"The real winners here are those people who need high quality, affordable housing as this deal will help up to meet the increasingly urgent housing needs across our area of operation."

By refinancing with its existing lenders, BPHA has been able to take advantage of improved margins in the social housing sector to achieve a better deal and make savings.

Mike Hartley, BPHA's Executive Director for Resources, added: "It is excellent news for our existing staff and customers, that a syndicate of such major lenders has the confidence in BPHA to lend this sum of money. In addition, it will benefit thousands of new customers as we embark on an exciting development programme offering homes across a range of tenures."

Around £100 million of the total sum has been earmarked to help BPHA work in partnership with the Orders of St John Care Trust, on a project to upgrade or replace former local authority care homes in Oxfordshire and Gloucestershire.

Members of Key Communities - an alliance of seven housing associations from across the East of England, led by BPHA - could also stand to benefit from the deal.

A principle built into the agreement means BPHA can ‘on-lend' parts of the funding to enable these smaller housing associations to benefit from development cash on the same terms.

This meets Key Communities' objectives of allowing each member to remain independent, while offering the best possible chance of developing new homes.

In addition to the longer-term benefits, BPHA has secured £6,000 from the lenders to be spent on community development projects.

This cash will be split between the fit@sixty project - which is helping to improve the fitness of those in BPHA's retirement schemes with a range of exercise classes - and a scheme to help people back into work.