First Choice Homes Oldham strikes £95m deal

Agreement secured on restructuring an existing £55m loan facility and taking £40m in new borrowing.

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First Choice Homes Oldham (FCHO) has worked with Savills Financial Consultants to deliver a £95m funding package from Santander UK that will underpin its plans to improve services and build more homes.

The 11,500-home housing association, which transferred its homes from Oldham Council in 2011, has agreed to restructure an existing £55m loan facility and take £40m in new borrowing – with Santander UK the provider of the existing and new funding.

This £95m package allows FCHO to remove some existing loan covenants from its original stock transfer deal and to increase its building programme to deliver 821 homes by 2023.

Chloe Christian, FCHO director of corporate services, said: “This is a significant moment for our organisation as we look towards our 10-year milestone as a housing association, we exist to improve lives in Oldham and developing homes to meet housing need is a key part of this.

“Our other areas of focus are on delivering improvements to our services and the ways customers access them, and working with communities and partners to improve health, education and employment outcomes to create thriving communities – the work with Savills Financial Consultants and Santander UK at this crucial point ensures we are in the best possible shape to deliver as we continue on our journey.”

Mike Roche, director at Savills Financial Consultants, acknowledged the operating context for English housing associations and the four-year 1% rent cut had presented major challenges for leadership teams in recent years.

“That said, this deal demonstrates what is possible when housing providers and financiers work together to deliver improved outcomes.

“As social landlords continue to evolve their strategies, we are confident that Savills Financial Consultants can provide the support needed for housing providers to maximise their ability to deliver on their updated plans.”

Evelin Matley, director, housing finance, specialist sectors group, Santander Corporate & Commercial, said: ‘We are delighted to support First Choice Homes Oldham with a financing solution to fund its social housing programme to deliver 821 homes by 2023.

“We believe we have the understanding and market insights to successfully support the sector across the UK and we look forward to working with First Choice Homes Oldham to help them build more homes.”

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