LGIM secures £270m green debt facility for its Wandsworth BTR Scheme

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LGIM Real Assets (Legal & General Investment Management), on behalf of its Build to Rent platform, has secured a four year, £270m green debt facility consisting of HSBC, NatWest and Standard Chartered

The green debt facility will be used for funding for the £500m Wandsworth Build to Rent (BTR) scheme. HSBC and Standard Chartered will act as joint sustainability coordinators meanwhile NatWest acts as documentation coordinator and agent.

The green debt facility funding is aligned to the Loan Market Association’s Green Loan Principles and one of the largest sustainable finance facilities in the housing sector to date. This means that loan proceeds are to be used to finance green buildings which meet regional, national or internationally recognised standards or certifications for sustainability.

One of the five Legal & General’s five BTR schemes in London is on the former B&Q and Homebase sites. This marks LGIM’s largest residential development to date. In total, the development will oversee the construction of more than 1,000 homes and over 60,000 sq ft of commercial space. 35% of those homes have been allocated for affordable pricing. It is expected that the first homes ready for occupation in 2023.

In 2021 LGIM Real Assets was the UK’s largest BTR investor

In fact, in 2021, LGIM Real Assets was the UK’s largest BTR investor. It committed £700m to the sector, across more than 2,000 new apartments and over six developments. Sites included: Birmingham, Glasgow, Hove, Southampton, Lewisham, and Stratford.

To date, LGIM Real Assets has committed £2.5 billion to the BTR sector. So that’s to 20 sites in 12 cities. Of these apartments, 2,500 apartments are already occupied and over 6,000 more are under construction.

LGIM Real Assets also secured a mandate with Legal & General’s retirement business (LGRI) for a further £2.5 billion investment into BTR in February 2022, delivering another 7,000 new homes over the next five years.

green debt facility

‘The debt facility demonstrates BTR sector’s solid investment proposition’

Dan Batterton, head of residential for LGIM Real Assets, commented:

“The debt facility demonstrates the BTR sector’s solid investment proposition where the existing imbalance between demand and supply continues to support growth. We’re redoubling our commitment to BTR following an exceptional year as the largest BTR investor with the largest number of new leases across the market.

“The apartments will be designed with a focus on lifestyle and resident satisfaction, delivering higher standards of design, service, and asset management, operational efficiency, and long-term environmental sustainability with operational net zero carbon targeted by 2030.

“In keeping with our Inclusive Capitalism purpose, we want to help tackle the UK’s housing crisis, create new neighbourhoods and bring brownfield sites back into effective use. This will also support local authorities in meeting their housing targets.”

‘The sustainable nature of the assets is testament to LGIM’s transition to a zero carbon economy’

Head of real estate at NatWest, Phil Hooper, said: “We are delighted to support LGIM in the delivery of over 1,000 new build-to-rent homes. The sustainable nature of the assets is testament to LGIM’s transition to a zero carbon economy and we are therefore pleased to complete the financing as a green loan.”

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