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Aviva Investors completes new funding arrangement for 307 homes

11 June 2015

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Global asset manager Aviva Investors has announced a new funding agreement with Genesis Housing Association.

The deal has taken place through Aviva's REaLM (Returns Enhancing and Liability Matching) Social Housing Fund and the loan agreement is secured on a portfolio of 307 residential properties in London and the Home Counties.

Martin Zdravkov, fund manager, REaLM Social Housing, said the deal demonstrated the value of a collaborative approach.

"We are excited to support Genesis with this loan agreement and play our part in enabling the delivery of more affordable housing," he said.

"We are a comprehensive funder with a long history of supporting affordable housing."

The funding proposition from the REaLM social housing fund allows registered providers to unlock latent capacity within the retained equity of shared ownership properties and raise long-term financing without any sales.

The transaction with Genesis means Genesis will keep all proceeds from the sale of further portions of shared ownership properties to the homeowners, meaning it works much like a domestic repayment mortgage.

Elizabeth Frounde, executive director of resources at Genesis Housing Association, said: "By just thinking a little more innovatively to tie the funding and interest to the rental stream of the property type, we have been able to maximise the available funding from a property tenure often seen as less attractive by mainstream lenders."

"From doing a little bit of extra work, we have now developed a framework which matches cost to income stream, a very competitive cost of funds, and a relationship with Aviva that can easily be replicated in the future."

The REaLM social housing fund invests in high quality UK residential properties that are owned and managed by registered providers.

It was launched in 2011 to invest in specialist real estate and infrastructure related assets that provide secure and long term cashflows.

The aim of the fund is to help investors, especially pension funds, match liabilities and capture long term income and they are structured to avoid the risk of assets held in more traditional property funds.

First published 11.06.2015

Lindsay.sharman@wilmingtonplc.com