Housing association Bromford has secured a £200m sustainability-linked loan with NatWest, which it will use to build more than 1,000 new affordable homes.
Bromford said the loan will allow it to build 1,300 new affordable homes across the West Midlands and West of England.
The loan is linked to targets focused on delivering new homes for social rent and reducing carbon emissions.
It will be split into two £100m tranches, maturing in 10 and 11 years respectively. Bromford will receive a discount on its interest payments if it meets the targets.
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Imran Mubeen, Bromford’s director of treasury, said: “The NatWest loan has the potential to generate over £1m of interest savings if we successfully meet our sustainability targets, which may challenge even the most sceptical of juries to reconsider the financial and broader benefits of sustainability-linked loans.”
Bromford’s sustainability targets have increased from a concentration on Energy Performance Certificate ratings to Scope 1, 2 and 3 carbon emissions.
Bromford director of development Amanda Swann said: “This loan from NatWest will allow us to continue our development programme to meet our ambition of building 11,000 new homes by 2032 with 65% at social and affordable rent tenures.”
In April this year, Legal & General said it was building its first net zero-carbon homes, as consumer demand for more eco-friendly properties continues to increase.
