Orbit Group, the 38,000 homes housing association group based in Coventry, today placed a £250million bond (including £50m retained bonds) to support its major housing investment plans to 2020.
The over-subscribed bond was placed at a coupon of 3.5%, at a margin of 1.15% above the gilt, and has a maturity of 30 years, is a clear sign of strong market confidence in Orbit’s plans. It follows a Moody’s market rating of the business at A1.
Orbit is aiming to bring another 30% of homes into management by 2020, by developing 12,000 new homes for the affordable and market sectors in residential sale, shared ownership and rent.
It has completed over 2,000 new homes in the first 2013-15 phase of its growth plan and has the third largest government grant-funded affordable housing programme in the country for 2015-18. On top of its affordable programme, Orbit expects to build and sell over 200 market sale homes in 2015-16 and has secured sites for its first private rental sector schemes in Norwich and Stratford-upon-Avon.
Paul High, executive director of Orbit Homes, said: “This £250million bond supports our development objectives for the next five years. We are in the market for new sites for residential development across the tenure spectrum.
“We expect to secure additional grant funding for affordable homes development in the coming years, and we’re seeking to expand our market sale and PRS activities. The bond is a massive boost to our investment plans and allows us to accelerate new site acquisitions and partnership opportunities. Orbit is open for business.”