PIC makes £100m investment in first Northern Ireland housing association deal
The Pension Insurance Corporation (PIC) has announced its first social housing investment in Northern Ireland, with a £100m debt investment in Apex Housing Association.
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The investment will see circa 1,500 new homes developed as part of Apex’s long-term strategy, as well as refinancing existing debt.
The investment is a long-dated, secured debt investment with a deferred drawdown structure.
There will be an initial funding of £60m, with £40m deferred for between one and two years, which is intended to meet Apex’s development plans.
The debt is due to mature in 2041 and 2055 to match PIC’s pension commitments in those years and the funds are secured on a pool of social housing assets.
Eugenia Korobova, debt origination manager at PIC, told Social Housing that the pension fund has a “positive view” on the social housing market in Northern Ireland.
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Ms Korobova said: “The regulatory environment is supportive, grant levels are high, and housing associations like Apex serve an important social purpose.
“PIC are open to exploring further investment opportunities in Northern Ireland.
“PIC always ensures that its cash flows match its expected pension payments over the coming decades.”
Apex currently manages more than 7,000 homes in Northern Ireland and is the third-largest housing association in the country, managing 25 per cent of all social housing provision.
The landlord is regulated by the Department for Communities, which is part of the Northern Ireland Assembly.
Roderick Canning, finance director at Apex, said: “This investment will continue to support our growth strategy of providing high-quality affordable housing to those in need across Northern Ireland.
“We look forward to strengthening our relationship with PIC and other investors so we may continue to provide cost-effective services for our tenants and service users.”
PIC said the development will have a focus on developing general needs family accommodation.
To date, the pension fund has invested over £2bn in social housing across the UK, making its first investment in the sector in 2012.
Ms Korobova added: “We are very pleased to have worked with Apex Housing Association on this transaction, which is our first housing association investment in Northern Ireland.
“The investment provides an attractive risk profile in an area of high demand for social housing. In addition, the maturity profile is well-suited to our liabilities.
“The team at Apex impressed us with its expertise, knowledge and strong governance and we are delighted to continue our commitment to supporting social and affordable housing.”
TradeRisks, part of the Gresham House Group, acted as sole arranger and dealer for the transaction.
Antoine Pesenti, head of capital markets at TradeRisks, said: “We are pleased to have supported Apex Housing Association on this private placement, which will allow Apex to continue to develop affordable homes across Northern Ireland.
“The fundraising attracted significant interest from lenders, and we continue to see strong investor appetite for housing associations.”
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