Pension Funds Insider

Pension Funds Insider brings the latest pensions news and industry insights; from investment and governance updates to new mandate appointments and pensions regulatory information.

Aviva completes Social Housing Fund arrangement in North Wales

21 May 2015

Image for Aviva completes Social Housing Fund arrangement in North Wales

Global asset manager Aviva has completed a new funding arrangement for 177 affordable homes in Wales.

The arrangement with Ty Glas, a wholly owned subsidiary of Pennaf Group, is the first transaction by the REaLM (Returns Enhancing and Liability Matching) social housing fund in Wales.

Martin Zdravkov, fund manager for REaLM social housing fund said: "We are excited to support Ty Glas and Pennaf Group by providing this funding package, which is a strong example of how a collaborative approach centred on a clear alignment of interests can unlock additional capacity from existing housing associations assets."

Launched in 2011, the REaLM fund range is designed to invest in specialist real estate and infrastructure related assets that provide secure, long term, inflation linked cash flows.

It aims to help institutional investors, particularly UK pension funds, address the challenges they face in matching liabilities and capturing long term income.

The partnership between Aviva and Ty Glas will provide a funding alternative for housing associations seeking to benefit from long-term financing.

It is part of a wider move towards social housing investment from pension funds.

"We continue to see considerable interest from UK pension funds in high quality real assets and institutional investors have the potential to play an increasing role in enabling the delivery of affordable housing," said Martin Zdravkov.

The Welsh government has welcomed the news and the investment into the economy. Minister for communities and tackling poverty, Lesley Griffiths, said:

"The Welsh government is working to support housing associations in Wales to access innovative forms of finance in order to deliver 10,000 much needed new social homes across the country.

"We are proud to have drawn such significant investment into Wales and ensure even more good quality homes are available to those in our communities most in need."

First published 21.05.2015