he Hill Group, the UK’s second-largest privately-owned housebuilder, has completed the full portfolio refinance in the first major sustainability-linked loan (SLL) valued at £220m, maturing in 2026.
As the group’s main source of debt funding for the delivery of its private development pipeline, this revolving credit facility was last renewed in December 2017 for £200m but has now been increased to £220m, with household UK banks; Lloyds Bank, NatWest, HSBC and Santander, each committing to a £55m loan. The refinance will support the Group’s five-year plan to double the size of the business to £1.2bn by 2025.
“Our sustainability-linked loan refinancing is an important step in our overarching group vision to become a leading sustainable housebuilder in the UK. We are extremely pleased with the confidence that these leading banks have placed in our long-term development plans,” said Tony Parker, Finance Director at Hill.
The new SLL will fund Hill’s long term development projects including multiple award- winning Knights Park development in Cambridge; Woolwich Leisure Centre, a mixed-used regeneration project comprising 500 new homes and community facilities, and the regeneration of the Teviot Estate in Tower Hamlets, London.
Using the SLL for its portfolio refinance, Hill will benefit from a lower interest cost as their green credentials increase in the future. This is based on four sustainability linked criteria – biodiversity net gain, reducing operational carbon, reducing scope 1&2 carbon and the company’s overall sustainability rating as measured by the NextGeneration scoring system.
David Cleary, Head of Housing at Lloyds who acted as sustainability co-ordinator for the deal, added: “We are delighted to have helped complete the refinancing of The Hill Group’s assets in partnership with NatWest, HSBC and Santander in our first SLL of the year in the housebuilding sector. It is a great step towards achieving a more sustainable future and we hope to see more housebuilders follow suit in the near future.”