LGIM Real Assets (Legal & General), on behalf of its Corporate Debt team, announces today that it has provided Saxon Weald £70m of sustainability-linked financing, to accelerate the UK’s development of new, affordable energy efficient homes. Centrus acted as the sole arranger.
Managing approximately 6,750 homes across Sussex and Hampshire, Saxon Weald is a housing association providing affordable rented and shared ownership homes for individuals and families, as well as properties exclusively for the over 55s. The proceeds of LGIM Real Assets’ investment will be used to finance new homes, designed to be energy efficient – with Saxon Weald targeting EPC A ratings on all new builds.
With rising energy bills, the efficiency of our homes has never been more in focus. The housing sector also remains a major contributor to carbon emissions, with heating and hot water for UK homes accounting for 25%¹ of total energy use and 15%² of the UK’s greenhouse gas emissions. If the UK is to meet net zero and be fit for the future, the housing sector requires rapid and radical change. This presents the social housing sub-sector with an immediate challenge – where private sector support will be key.
Tackling this, via a forward-thinking pricing structure with sustainability at its core, Saxon Weald will receive a discount on the coupon provided it meets ambitious energy efficiency targets – better supporting the communities in which Saxon Weald operate, and more widely, playing an important role in the South-East’s energy transition.
Highlighting Legal & General’s longstanding ESG agenda, today’s investment brings LGIM Real Assets’ investments with ESG-linked credentials in the corporate debt space to over £400m, spanning the Social Housing, Higher Education, and Corporate sectors. A significant proportion of this financing has gone towards the social housing sector specifically, supporting some of the UK’s largest social housing providers across major cities and regions* with their decarbonisation and social impact ambitions.
Centrus worked with Saxon Weald to develop strategy and provide transaction advice. Legal counsel was provided by Devonshires and Addleshaw Goddard.
