Circle Voluntary Housing Association (VHA) has agreed a landmark €51 million investment package which will provide social and affordable housing for families across the country. The approved housing body announced7 its plans today to deliver 250 homes over the course of the next 12 months through an innovative model of financing.
The finance package, structured by Centrus, who acted as Financial Advisor to Circle, and funded by AIB, provides the housing association with a three-part loan, over a 30-year period, which includes a revolving credit facility, a term loan and a working capital facility. The nature of the agreed package allows Circle VHA to re-use the borrowed funds at any time over the period of the loan, providing a safeguard for ongoing speedy development of social housing.
The deal is now the largest private financing package to any approved housing body in the country, and it is hoped that the initial 250 properties are the first of many thousands to be developed in the coming years in areas such as Greater Dublin Area, Cork, Limerick, Waterford Kildare and Galway.
The positive announcement comes in the midst of negativity as the Department of Housing, Planning and Local Government announced latest figures of 10,514 homeless people living in emergency accommodation in recent weeks.
John Hannigan, CEO, Circle VHA says, “We are absolutely delighted with this historic agreement which has ultimately safeguarded our passage to delivering over 250 homes for social housing across the country in a mere matter of months. This innovative public-private partnership approach is what is needed to solve the housing crisis and now with our 30-year agreement and our existing structures, we estimate we will be able to bring approximately 300 social houses to the market each year. This finance solution was a result of combined-thinking and collaboration between Centrus, AIB and ourselves. What we have achieved is a modern approach to financing that has never been accomplished in this sector before. It is a sustainable model which will benefit thousands of families over the course of many years due to the revolving nature of the credit, allowing us to expand and provide additional homes on an ongoing basis.”