Arlingclose is delighted to have arranged a £73m revolving credit facility for the London-based housing association Optivo, funded by UK local authorities.
The three-year deal, with extension options, was backed by comprehensive loan terms, negotiated to complement existing funding and reporting requirements, while providing flexibility on the draw rate and non-utilisation charge.
For Optivo the transaction provides cost-efficient backstop facilities, frees up security and introduces a new medium-term funding source from lenders whose values are aligned.
The local authority lenders benefit from excellent credit quality, an on-going source of income to support services, and Bank Rate-linked margins in a period of rising interest rates.
The facilities are a great example of direct ESG investing, with funding used to support the provision of social housing.
Arlingclose acted as the arranger; undertaking due diligence, sourcing funds, negotiating loans terms and liaising with all parties throughout the transaction.
Anthony Collins Solicitors acted as the legal advice on the lenders’ behalf. Devonshires Solicitors acted for Optivo.
Arlingclose CEO Mark Pickering said “This is a great example of how high quality housing associations and local authorities can work together, we expect a growing number of associations will be interested in this model”.
Optivo’s Director of Corporate Finance, Tariq Kazi said “Optivo uses medium-term flexible funding from a range of channels to cover our funding needs and we’re pleased to diversify our sources with nine local authorities supporting us through Arlingclose”.
For further information please contact:
Nicholas Keeling, Client Director
Stephen Kitching, Consultancy Director
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