Housing associations raise £650m for development

Major developing housing associations have raised well over half a billion pounds in order to bolster their finances and deliver more new build homes.

Birmingham-based registered provider Midland Heart announced yesterday it had raised £250m on the bond market at a record low yield, after London-based Hyde Group on Friday said it had raised £400m in the same way.

Midland Heart said the funding enabled it to deliver on plans to build 3,000 homes between 2019 and 2024. The association said the capital raised from the bond’s issue will “further support our work to help fill the gap for the need of affordable housing in the UK.”

Chief executive Glenn Harris said: “Providing customer excellence is at the heart of everything we do and this increased investment will help to further improve the services that our customers rely on and to develop more affordable homes for those who need them.”

Meanwhile, Hyde Group said the money raised by it was at a lower interest rate than a £400m bond issued in 2017, and a £200m bond raised in 2010. Rod Holdsworth, chief financial & resources officer, said: “The savings we will make on interest payments puts us in a great position to deliver on the aspirations we set out in our strategic plan 2050 and ultimately, to build more homes for people who need them.”

Hyde’s strategic plan includes an ambition to build 2,000 homes a year by 2025.

Midland Heart’s bond was issued at an interest rate of 1.831%, while Hyde Group’s came in at 1.75%.