Bank club writes £65m for Scottish housing project

Royal Bank of Scotland and Bank of Scotland have provided a £65 million (€71 million) loan to Wheatley Group for a social housing development.

Royal Bank of Scotland and Bank of Scotland have provided a £65 million (€71 million) loan to Wheatley Group for a social housing development.

The five-year revolving credit facility takes the total raised by Wheatley for its scheme of 3,500 new affordable homes across Scotland to over £500 million. Wheatley is Scotland’s largest provider of housing and manages 83,000 properties.

In May, the scheme secured £100 million of private finance from BlackRock. The move was part of a drive from private debt funds to finance UK social housing, as demand continues to increase and many housing associations shied away from the public markets last year.

Besides alternative lenders, banks are also looking to finance the development of purpose-built rental properties in the UK.

Along with the £65 million loan announcement, Wheatley has unveiled the completion of a new development at the Govan tram depot site in Glasgow. The £11 million development, part of Wheatley’s social housing scheme, includes 105 flats and terraced houses.

The new project was partly funded by the Scottish Government with a £5.5 million grant and by capital raised by Wheatley on the bond market in 2014. The housing provider raised £300 million through a public bond, but retained £50 million.

The Govan site, which takes in Brand, Harvie and Clutha streets, comprises 85 homes for social rent by the Glasgow Housing Association and 20 mid-market flats in the refurbished, red sandstone former tram office let and managed by Lowther Homes.

Scotland’s First Minister Nicola Sturgeon, who visited the new development, said the Scottish government is investing more than £3 billion to deliver at least 50,000 affordable homes – 35,000 for social rent during the next four-year parliament.

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