Circle Anglia Secures Multi-Billion Pound Loan Deal

Fri, 15 Feb 2008

Circle Anglia, one of the largest housing groups in the UK, has secured Britain’s largest-ever social housing sector finance agreement, worth £1.7 billion.

The multi-million pound deal to help the group expand over the next five years comes despite the drip-down effect of the credit crisis, which has led to a tightening in lending conditions by banks and financial services across the country.

The deal consists of £800m of refinancing and £900m of new money from banks, including Barclays, Abbey, Lloyds, RBC, Nationwide, RBS, Dexia and HBOS .

Calum Mercer, Circle Anglia’s group finance director, said that the deal had taken over a year to complete and that most of the terms had been agreed upon with the banks prior to the credit crunch.

He said the banks’ willingness to provide the funds was due to the stable nature of the social housing sector in relation to the more-open private sales sector.

"There is a great need for social housing and because of this secured rental, it is a more stable means of income," he added.

"The £1.7bn deal is the largest new financing in the sector and we have worked hard with our lenders to ensure that any financial risk has been kept to a minimum."

The loan is expected to help fund the group’s development of more than 10,000 new properties over the next five years, as well as financing the refurbishment and updating of its existing 46,000 properties .

Mercer stated the loan deal confirmation means the company is on course to surpass its goal of managing over 60,000 affordable properties by 2010.

Circle Anglia’s housing stock has recently increased by over 40 per cent following the addition of three further housing associations to the group.
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