Funding deal sees housing firm edge closer to £1bn goal

● Scottish Widows and Bank of Scotland sign £76.5m long-term loan agreement

Scottish housing group Wheatley has struck a £76.5 million funding deal with Scottish Widows and Bank of Scotland that will pave the way for 700 new affordable homes to be built.

The finance deal agreed by the Glasgow-based group follows on from £185m funding secured from the European Investment Bank earlier this year and brings the total raised by Wheatley since 2013 to almost £930m as it homes in on a target of attracting £1 billion of private and public investment.

The latest loan agreement will see Glasgowbased Wheatley’s subsidiary Lowther Homes buy 560 midmarket rent properties currently owned by three of its housing associations – GHA, Cube and Dunedin Canmore.

They will use the proceeds to build 700 new homes as part of Wheatley’s wider ambition to complete 7,500 affordable houses and flats through to 2025.

Wheatley chairman Alastair Macnish said the latest funding deal was a significant milestone in the group’s efforts to boost the supply of affordable homes across the country.

“It is a massive vote of confidence by Scottish Widows and Bank of Scotland in both Wheatley and the affordable housing sector, and one that will lead to hundreds of new, affordable, high-quality, energy-efficient homes.”

The debt funding deal has been provided by Scottish Widows through its partnership with Bank of Scotland’s real estate and housing team.

Jason Morris, director of loan investments for Scottish Widows, said: “Structuring this long-term loan provides Wheatley Group with the certainty of fixed-rate funding for the next 25 years.

“We are delighted to support the provision of much-needed affordable homes building on our previous commitments to the housing sector.”

Wheatley is the largest developer of social-rented homes in the UK, having completed 2130 since April 2015. It is building or working on plans for almost 3,000 more affordable homes on 58 sites across Scotland. From 202125, Wheatley plans to sustain a house-building programme of up to 650 homes a year that would take the total number built between 2015 and 2025 to over 7,500.

In acquiring the 560 midmarket properties from the three Wheatley housing associations, Lowther will become the largest private landlord in Scotland, owning more than 1,700 homes in Glasgow, Edinburgh, Inverclyde, Lanarkshire and Renfrewshire.

Lowther previously managed the 560 mid-market homes on behalf of the housing associations. Wheatley works with 250,000 people in 17 Scottish local authorities.

Its GHA arm is Scotland’s largest social landlord with 40,000 homes in Glasgow. Dunedin Canmore owns 5,500 homes in Edinburgh, the Lothians and Fife and The Cube has more than 3,500 homes across the west of Scotland.