Legal & General has announced a £50m, 40-year loan to Chorley Community Housing, a subsidiary of Adactus Group, to fund a pipeline of 814 homes over the next three years in the North West.
The homes will be built with annuity money and the return on the loan will be used to pay pensioners' annuities.
The sites for development are in and around Chorley, Lancaster, Morecambe and Preston. They will include family homes and flats at below market rents, and also properties for sale on shared ownership.
L&G's lending arm, Commercial Lending Limited, is providing the 40-year funding. The financing is secured against a portfolio of existing assets as well as CCH's housing development pipeline. The loan includes flexibility tailored to the borrower's development activities, with a deferred drawdown profile through to December 2016 and asset cover tests against a combination of properties completed and in development.
Alex Gipson, lending manager at L&G, said: "From the outset, one of the main aspects that attracted us to working with the group is its progressive attitude. Having made a major commitment to supporting UK housing and infrastructure, L&G chooses to partner with forward thinking operators who play a part in driving economic growth and maintain enduring business models. Having seen the developments that CCH are delivering at first hand, it is easy to see the positive impact being made within the local communities they touch."
This is L&G's second lending deal to the Adactus Group, following a £25m loan in July last year.
CCH was formed in 2007 to as part of a transfer of Chorley Council's housing stock. The association manages more than 5,420 homes around the Chorley district.
CCH was advised by Edmond de Rothschild Corporate Finance, London. The legal firm acting for CCH was Trowers & Hamlins, whilst Pinsent Masons advised L&G.