MIDIS arranges £150 million of debt financing facilities to Alliance Homes Group
London, 10 Jan 2019
Macquarie Infrastructure Debt Investment Solutions (MIDIS) has arranged and financed long-term debt facilities totaling £150 million, including a private placement of £90 million to charitable registered housing provider Alliance Homes Group (Alliance Homes).
Alliance Homes currently owns and manages around 6,500 homes that are largely social and affordable properties in the South West of England, located across North Somerset, Bristol and South Gloucestershire.
The funding will support Alliance Homes by refinancing existing bank debt and also enable its plan to grow the provision of much needed housing in an area that continues to suffer from a housing shortage and increasing rents.
All of the committed funding has been drawn, comprising a £70 million fixed rate tranche, amortising over 35 years, and a £20 million floating rate 20-year bullet tranche. The MIDIS facilities also enable them to request an additional £60 million under similar terms to support further growth. Alliance Homes has an ambition to develop 1,000 homes predominantly in North Somerset.
Alongside this funding, increasing government grants to the sector will also support the deliverability of new housing, something that MIDIS sees as a positive outcome for all stakeholders.
Gareth Edwards, an Associate Director in MIDIS, explains: “There is a clear government directive in delivering more affordable homes at this time, and we are very pleased to have provided funding to Alliance Homes at this juncture in their evolution. We continue to see strong demand from investors seeking to support the UK’s social infrastructure needs.
Alliance Homes has a strong and experienced management team who focus on their customers, through maintaining high standards in their housing stock, provision of support services to their communities, and delivering more homes where needed. We were particularly impressed with, amongst other things, the social impact of their business, including care facilities, formal programs to support tenants back into employment and their other work throughout the communities in which they operate. As we continue to provide more financing to the sector, we look forward to working with them and our other social housing partners over the duration of the funding.”
Katrina Michael, Chief Finance Officer at Alliance Homes, said: “We are expanding our development activities over the next few years and we are very pleased with the flexibility of the financing package available with MIDIS, who has taken a long-term outlook on our business, and shown a willingness to listen to our funding needs. We look forward to building a long-term partnership.”
This is MIDIS’ fourth financing in the UK social housing sector, taking total commitments to nearly £300 million, and total facilities to over £550 million. These investments have been made on behalf of MIDIS’ institutional clients, who are increasingly focused on maximising the social and environmental impact of their investments.
Since 2012, MIDIS has been awarded mandates of £6 billion and deployed over £4.7 billion in investments, including fixed, floating and inflation linked debt - across transport, regulated utilities, renewables and social infrastructure.
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Macquarie Group Limited (Macquarie) is a diversified financial group providing clients with asset management and finance, banking, advisory and risk and capital solutions across debt, equity and commodities. Founded in 1969, Macquarie employs 14,869 people in 27 countries. At 30 September 2018, Macquarie had assets under management of £305.6 billion. For further information, visit www.macquarie.com.
About Macquarie Infrastructure Debt Investment Solutions
In early 2012 Macquarie established the Macquarie Infrastructure Debt Investment Solutions (MIDIS) platform to leverage the infrastructure expertise within Macquarie into an investor-aligned global infrastructure debt investment management business. The MIDIS platform has been successful in securing mandates with insurer and pension scheme clients and has a track record of investing at attractive yields.