£14.45M OF DEBT SECURED ON LOCAL AUTHORITY HOUSING
29 January 2019
£14.45 MILLION OF DEBT SECURED ON LOCAL AUTHORITY HOUSING IN LUTON
Residential Secure Income plc ("ReSI" or the "Company") (LSE: RESI), which invests in residential asset classes that comprise the stock of UK social housing providers, announces that it has obtained a £14.45 million debt facility, secured against the 289 units in its local authority housing portfolio.
The financing package will be used to fund the portfolio pending refinancing with long term debt in combination with other assets. The facility has a 3 year term and a margin of 1.50%, with the rate to be fixed at the time of drawing. The terms recognise the underlying leases are with an investment grade local authority, in this instance Luton Borough Council, in line with ReSI's stated strategy at IPO.
TradeRisks and ReSI are continuing to work with debt investors to put in place further borrowing against ReSI's recent and future acquisitions, in line with its strategy to target an overall level of indebtedness of 50% loan to gross asset value and a low cost of long-term funding.
Having raised £180 million of equity at IPO, ReSI has to date invested £234 million in acquiring a portfolio of 2,435 residential units serving retirement, Local Authority housing and shared ownership tenants.
ReSI intends to use the proceeds of this facility and of future borrowing to fund further acquisitions, predominantly in the shared ownership sector, for which ReSI has agreed heads of terms, subject to exclusivity, and on which ReSI is currently performing detailed legal and property due diligence.
FOR FURTHER INFORMATION, PLEASE CONTACT:
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ReSI Capital Management Limited / TradeRisks Limited Ben Fry Jonathan Slater Mark Rogers Alex Pilato Richard Stubbs
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+44 (0) 20 7382 0900 |
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Jefferies International Limited Stuart Klein Gary Gould
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+44 (0) 20 7029 8000 |
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FTI Consulting Richard Sunderland Claire Turvey Richard Gotla
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+44 (0) 20 3727 1000 Email: resi@fticonsulting.com |
Notes:
Residential Secure Income plc (LSE: RESI) is listed on the premium segment of the Official List of the UK Listing Authority and was admitted to trading on the Main Market of the London Stock Exchange in July 2017.
ReSI has been established to invest in portfolios of Homes across residential asset classes that comprise the stock of Housing Associations and Local Authorities, comprising Shared Ownership Homes and Rental Homes (being Market Rental Homes, Functional Homes and Sub-Market Rental Homes) throughout the UK.
ReSI is managed by ReSI Capital Management Limited, a wholly owned subsidiary of TradeRisks Limited which has a 17 year track record of executing transactions within the UK social housing sector and, to date, has arranged funding of over £10 billion in the social housing, care and other specialist residential property sectors.
ReSI seeks to deliver secure, long-dated, inflation-linked income returns through investment in UK social housing. It aims to meet demand from Housing Associations and Local Authorities for alternative equity-like financing sources that allows them to recycle capital back into socially and economically beneficial new housing, making a meaningful contribution to the UK housing shortage.
Homes acquired by ReSI will predominantly be on a freehold or long leasehold basis (typically 99 years or more to maturity) and benefit from long term (typically 20 years plus) inflation-adjusted cash flows. Acquisitions by ReSI will be limited to Homes with sufficient cashflows, counterparty credit quality and property security that allow the Fund Manager to arrange long-term investment grade equivalent debt.
Further information on ReSI is available at www.resi-reit.com
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