Seventh housing association launches Euro Medium-Term Note programme

News23 Feb 2021Sarah Williams

Midlands-based social landlord Platform Housing Group has become the seventh housing association to market its own Euro Medium-Term Note (EMTN) programme, establishing a £1bn “multi-currency” structure.

Picture: Getty

Sharelines

Seventh housing association launches Euro Medium-Term Note programme #SocialHousingFinance #UKhousing #ESG

Midlands-based social landlord @PlatformHousing has become the seventh housing association to market its own EMTN programme, establishing a £1bn “ESG-enabled”, “multi-currency” structure #SocialHousingFinance #UKhousing #ESG

The group’s adoption of the approach, which is designed to provide swift access to the capital markets, sees it join just six other housing associations in doing so.

Prior to Platform, South of England provider Aster was the most recent EMTN adopter, ahead of its £250m sustainability-labelled bond last month.

Announcing the launch yesterday (22 February), Platform said that its new programme was “ESG-enabled”, meaning that it will enable the issuance of ‘sustainability’ bonds, if and when the group applies a sustainability financing framework.

The programme is also secured and “multi-currency” in nature, allowing the organisation to issue in a range of denominations including sterling, euros and US dollars, should it choose.

Credit ratings agency Fitch has handed an expected rating of A+ to the programme, in line with the long-term issuer default rating it gave the group earlier this month, with negative outlook.

In its commentary, the agency said that the ratings reflected Platform’s “moderate debt, stable debt metrics and strong liquidity”, which it expects to remain stable despite the group’s “ambitious development plans”.

The group, which formed from the merger of Waterloo and Fortis Living in 2018, owns 46,000 homes in total and has outlined plans to deliver 18,000 affordable homes over a 10-year period. In 2019/20, it completed 1,448 homes following investment of £258m, more than a third (523 homes) of which were at social rents.

“The programme signals that Platform is committed to fundraising from the capital markets and its A+ ratings demonstrate we remain a sound investment,” she said. “It will help us access the funding that we need to invest in our homes and our communities as we continue to help alleviate the Midlands housing shortage and provide enhanced life prospects for more people.”

George Flynn, vice-president – financing and risk solutions at NatWest Markets, said: “We are delighted to have supported Platform as sole arranger in the establishment of its £1bn EMTN programme.

“This follows on from our support during its inaugural £350m public bond executed in 2020 and provides a flexible and versatile framework to maximise Platform’s funding agility.”

Platform joins six other housing associations in having established an EMTN programme. Prior to this year’s take-up by Aster and Platform, the most recent adopter was G15 provider L&Q, which launched its £2.5bn offering in September 2020, ahead of a £250m outing to the markets the following month. L&Q’s programme allows it to issue both secured and unsecured notes.

South West based provider LiveWest launched its £1bn secured programme in late September 2019, from which it issued a £250m, 24-year bond a month later. Earlier this month it returned to the markets to issue a further £250m through the programme (with £100m retained), at an all-in rate of 1.904 per cent, and a spread of 90 basis points over gilts.

Other earlier adopters of the note programmes include A2Dominion, Places for People and Clarion, currently standing at £1bn, £2bn and £3bn respectively.