Sanctuary secures landmark direct loan from European Investment Bank

Sanctuary Group has become the first UK housing association to secure a direct loan from the European Investment Bank.

The EIB loan, worth £350m, will be used to finance the remainder of Sanctuary’s affordable homes programme, which will see the delivery of 5,000 units by March 2015. It will also take the association into its 2015-2018 housing programme.

Sanctuary already has 96,000 homes under its management.

The housing association said: “A non-profit making organisation, the EIB shares common objectives with Sanctuary – both are driven by the need to improve social impacts, generate sustainable growth and create employment opportunities, making the new partnership an ideal match.”

EIB Vice President Jonathan Taylor said: “The loan formally agreed with Sanctuary Group marks the first direct engagement between the European Investment Bank and a UK housing association for a UK-wide investment programme.

“This is a milestone in a new drive to support construction of affordable housing by housing associations across the country and follows the launch last month of a £500m EIB loan to be managed by THFC, earmarked for the construction of affordable housing by smaller UK housing associations.”

Nick Baldwin, chair of Sanctuary Group, said: “This major finance agreement is a clear reflection of the confidence the EIB has in Sanctuary’s business model, and signals a fresh approach to funding opportunities in the housing sector at a time when public subsidies are expected to decrease.”

“The EIB is a sizeable funder, with excellent credit quality and moreover, its broader social aims align well with ours, which is why we were keen to forge an alliance with them.”