Legal & General’s lending arm, LGIM Commercial Lending Limited has announced that it has agreed a £50 million, 25 year loan to Sanctuary Group, as it continues to invest in all tenures within the UK housing sector.
The financing is secured against a portfolio of care homes and the money will be used to invest in both Sanctuary’s existing properties as well as the delivery of new, quality housing. The investment has been made on behalf of L&G’s annuity fund, providing excellent liability matching qualities, a better return for our pensioners than investing in gilts, and a social purpose – stimulating economic growth for the UK by freeing up capital to build and improve housing.
Sanctuary Group manages around 100,000 homes throughout England and Scotland, including general rented, retirement living, supported housing, student and key worker accommodation and care homes.
CLL has now invested a total of over £1.2 billion across 15 deals. Transactions include seven loans to the social housing sector, two loans to the student accommodation sector, two hotel debt deals and two loans to the care home market.
CLL forms an important strand of L&G’s UK infrastructure investment strategy and sits alongside £6.3bn of direct investments. Other commitments include that to the English Cities Fund which invests in five city regeneration schemes, CALA, the UK’s premium major home builder for exposure to the buy to sell market and, most recently, investment in the build to rent sector, which includes schemes in Walthamstow and Salford. In total, L&G’s commitment to UK infrastructure already supports a pipeline of almost 30,000 homes across a range of tenures.
Alex Gipson, Lending Manager at Legal & General, said: “L&G’s long term commitment to backing the provision of new and improved UK housing across all tenures is clear. In order to do this, we understand that we need to partner with and support best-in-class, forwarding-thinking operators that have significant experience and expertise in the sector and share our long term commitment to their homes and the services they deliver. In Sanctuary we have found such a partner with a shared vision.”
Craig Moule, Chief Financial Officer for Sanctuary Group, commented: “This loan will enable us to build new homes and refurbish existing properties for the benefit of our customers. In L&G we have a partner with a shared vision for the UK housing market while continuing to develop our core business in line with the Group’s growth strategy.”
The deal represents L&G’s second transaction with Sanctuary. Pinsent Masons acted as legal advisers to L&G and Wragge Lawrence Graham & Co acted for Sanctuary. CBRE provided L&G with valuation advice.