It was announced today that Oaklee Housing, one of the largest Approved Housing Bodies (AHBs) in Ireland, has launched a long-dated (25 years+) €50m debt financing agreement with German-based Norddeutsche Landesbank (NORD/LB).
The debt facilities are based on a project financing structure and secured through a wholly owned subsidiary and charity, or Special Purpose Vehicle (SPV), of Oaklee. It is the first AHB to establish a financing structure of this type to secure an attractive fixed rate of borrowing over the term of the loan and access to a short-term working capital facility.
The Special Purpose Vehicle (SPV) loan structure provides Oaklee with access to committed, long-term fixed rate debt from a private funder utilising the existing Capital Advance Leasing Facility (“CALF”) and Payment and Availability (“P&A”) funding support structures available to AHBs from the Department of Housing, Planning and Local Government through local authorities.
Established in 2001, Oaklee Housing has quickly grown into one of the leading social housing providers in Ireland managing 900 high quality modern homes that accommodate older people, families, mature singles and people with complex needs. Future delivery plans are geared towards significantly increasing stock through a combination of acquisitions and construction.
Oaklee manages 900 social homes and said the loan facility will be used to purchase 250 additional residential units for social housing throughout Ireland. A deal has already been agreed with the Housing Agency for the acquisition of 148 vacant properties, with the majority located in Dublin.
Eoghan Murphy T.D. Minister for Housing, Planning and Local Government welcomed the news that Oaklee has secured this loan facility. He said that he recognises the valuable contribution that Approved Housing Bodies make to the delivery of social housing and he noted that there are ambitious targets set for the AHB sector in the implementation of Rebuilding Ireland. He added that the news regarding this loan facility demonstrates the potential for the AHB sector in providing social housing.
Commenting on the new initiative, Chief Executive of Oaklee Housing, Sharon Cosgrove said, "Our innovative SPV financing structure and subsequent agreement with NORD/LB is putting more than €50million directly into the delivery of circa 250 social homes in the areas where they are needed most. It is pleasing to see an international bank investing with confidence in large scale housing programmes and we hope others will follow."
She added, "This is one of the most cost-effective long-term finance arrangements ever used in Ireland and means that we can make public money go further and deliver more. It represents good business for Oaklee and is a strong vote of confidence in our ability to deliver high quality homes for those in greatest need across Ireland in the years ahead."