Pioneer Group secures £35m for new affordable homes

The Birmingham-based Pioneer Group has secured a £35m long-term loan from Scottish Widows as part of its plans to build 250 new affordable homes by 2025.

The 30-year fixed rate loan has been agreed with an all-in interest rate of around 2.3%.  The funding is fully deferred for two years and will be drawn in October 2022.

‘This is great news for the Pioneer Group and for at least 250 new households when we get our next development programme underway,’ said chief executive, Simon Wilson.

‘This new loan agreement fuels our commitment to expand our portfolio of homes in a sustainable way and to support local housing needs. Our vision is simple – to Make Lives and Communities Better with our current and future assets and our heritage of being a community-focussed organisation.’

Normal funding roadshows were not possible under the current coronavirus restrictions, so the Pioneer Group met with potential funders through Zoom video conferencing.

The latest funding follows the Pioneer Group being awarded a £5m social housing grant from Homes England, as part of its membership of the Matrix Housing Partnership consortium.

Savills Financial Consultants were the sole financial advisor to the Pioneer Group on the deal, while Bevan Brittan advised on the legal aspects.

Bruton Knowles conducted security valuations and Law Debenture are acting as security trustee.

‘We are delighted to have worked with the team at the Pioneer Group in structuring a long- term funding solution to meet its strategic objective of developing much needed affordable homes in the Midlands, whilst securing high quality cashflows aligned with our annuity liabilities,’ said Scottish Widows’ associate director, Gavin Reid.

‘This continued investment in the sector highlights our ongoing commitment to supporting core UK social infrastructure at a time when demand has never been more pressing.’

Photo Credit – The Pioneer Group (Supplied)