Housing association secures £75m sustainability-linked loan from Lloyds Bank
Alliance Homes has secured a £75m sustainability-linked loan from Lloyds Bank which has targets linked to the energy efficiency of its homes.
The Portishead-based housing association will be measured on three key performance indicators (KPIs) to receive margin discounts on the funding.
These including achieving an energy performance certificate (EPC) rating of C standard across all its stock by 2028, building 2,000 new homes over the next 10 years, and installing 519 new photovoltaic systems – solar panels – to tackle fuel poverty for customers.
Alliance, which owns and manages 6,500 homes across North Somerset and the West of England, hopes the funding will grow its portfolio of affordable homes by 25%.
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Katrina Michael, chief financial officer at Alliance, said: “The challenges of addressing the current housing shortage while investing in communities and becoming more sustainable are top of the agenda for social housing providers across the UK.
“We must address these challenges head-on and meet our responsibility to future-proof our homes with the support of our banking partners.”
She added that the funding will allow the organisation to “invest in improving communities”.
Lauren Bailey, relationship director for housing at Lloyds Bank, said: “Housing associations have no time to waste to invest in growing their stock and addressing ESG [environmental, social and governance] challenges.
“They need to act now to ensure the communities they operate in have the foundations in place needed to prosper.
“Alliance Homes recognise this, and we’re pleased to support the association as it works to meet the challenges the sector faces.”
Alliance is the latest landlord in the sector to sign up to a loan that includes discounts if the housing association meets certain ESG targets.
In April last year, Clarion secured a £100m loan with NatWest which set targets based on the ‘social value’ of its supply chain.
Last September, Peabody signed a new loan agreement with NatWest that will reduce the cost of borrowing if the landlord meets targets related to the energy efficiency of its existing stock.
Earlier this week, Bromford announced that it would use the savings from the first year of two ESG loans it has signed to pilot a scheme to support domestic abuse survivors.
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