Harper Macleod has advised Kingdom Housing Association (KHA) on an £85 million funding package under a debut private placement which secures its development programme of over 1,100 homes until the end of 2019-20.
This is the latest in a number of private placement transactions which the housing team at Harper Macleod has successfully delivered for Scottish housing association clients, helping them access long-term funding from institutional investors at attractive rates. To date, Harper Macleod’s specialists have advised on private placements which have raised an approximate total investment of £360 million.
The funding package amounted to £85 million of borrowing which is being provided by institutional investors jointly for a period of 30 years with repayment in 2048 and 2049.
The borrowing, which is secured against KHA’s housing assets, is to be used for Kingdom’s development programme and to repay £10 million of existing short-term debt placing it on a competitive long term rate.
Harper Macleod’s team, led by Partner and Head of Housing Derek Hogg (picture) and Senior Associate Collette Miller, acted in all aspects of the transaction, providing legal advice to KHA throughout the project, acting as “issuer counsel” to KHA as the issuer of the £85m loan notes, helping to negotiate and finalise the finance documents, and undertaking a security exercise which involved putting 75 separate housing developments into a security trust.
The firm also provided advice and support to KHA’s board and short life working group of board members, meeting with them to help them understand the nature and structure of the project, how to manage key risks, selection of the preferred investors, and relevant governance issues.
Law Firms: Harper Macleod;
Clients: Kingdom Housing Association (KHA);