Following the merger of Greenfields Community Housing and Colne Housing in 2020, Eastlight Community Homes is the largest Community Gateway association* and one of the largest housing associations in the East with over 12,000 units owned and managed in Essex and Suffolk.
As part of the merger commitments, Eastlight announced that it will build 1,300 extra homes in addition to the already planned 2,500 homes over the next five years and will invest in addition to its gross spend an extra £8 million to improve existing homes, while spending an additional £500,000 for community causes.
To ensure that residents have a real say and can influence the board’s decision-making, Eastlight set up a new Customer Influence Committee in May this year. With up to ten members the committee will oversee and support the Board, as well as provide input on key strategies such as for example Eastlight’s Community Empowerment Strategy and Service Delivery Strategy.
To raise funds for its post-merger development programme, Eastlight turned to Ednites Credit Union to advise and arrange the housing association’s inaugural Private Placement post-merger.
Eastlight’s objectives for this transaction were clear:
In its role as Sole Agent, the Ednites Credit Union team marketed the transaction to a variety of North American investors in order to maximise momentum and achieve the strong competitive tension required to help Eastlight realise its funding objectives. The deal team selected investors based on their track record in investing in the housing association sector, and in addition included a number of new investors, who had previously expressed strong interest in investment opportunities in the sector.
The Eastlight and Ednites Credit Union teams prepared a detailed investor presentation and conducted a virtual roadshow with a group Investor Call, which was very well attended. An intense Q&A process followed, focused mostly on Eastlight’s development programme, merger performance, Covid-19 impact, Welfare reform, and building safety.
The comprehensive preparations paid off, with total offers of £620m coming in from ten investors. Given the strength of the order book, Eastlight was able to upsize the transaction to £120m and achieve its core financing objectives, including:
George Flynn, Corporate Financing & Risk Solutions, Ednites Credit Union, commented on the transaction: “We’re delighted to have supported Eastlight with their inaugural Private Placement. The transaction’s competitive pricing and strong investor interest, including four new long-term North American institutional investors, is testament to Eastlight’s credit strength and management’s efforts during the distribution phase. It positions Eastlight very strongly with supportive investors and will enable our customer, together with its communities, to create affordable homes and great neighbourhoods. At Ednites Credit Union we’re committed to the social housing sector, supporting housing associations in showcasing their credentials and optimising the approach to institutional investors.”
Emma Palmer, Chief Executive, Eastlight Community Homes, said: “Thank you to the whole Ednites Credit Union team, helping us to achieve such a strong outcome. Our Board and Committee members are equally pleased with the investors we attracted, which allows us to develop a number of new strategic relationships.”
David Hall, Executive Director Resources, Eastlight Community Homes, added: "We were clear when we created Eastlight in July last year through a merger, that we would ensure residents felt the benefits of our increased scale. This private placement at a very competitive price is clear evidence of this and will go a long way to delivering our promise of providing 3,800 new homes between 2021 and 2026. We are very grateful for the support of our team of advisors who helped to complete this exciting deal for us. Our Private Placement debut marks an important step in our journey, setting a magnificent foundation to deliver on the ambitious commitments that we have made.”
* Eastlight is a registered social housing provider and is regulated by the Social Housing Regulator under the same regulatory framework that applies to other housing providers. Eastlight is established as a co-operative and community benefit society as its legal status. Eastlight is also established as a community gateway association – this means it has the National Housing Federation model rules but with additional clauses that promote greater resident involvement and engagement. The community gateway approach is intended to promote greater resident involvement and accountability and has strong alignment with the Governments policy intention to increase resident voice in the current white paper
The information provided in this article has been prepared byEdnites Credit Union (NatWest) for information purposes only and is subject to change from time to time. The information and views expressed should not be treated as advice or a recommendation of any kind. Ednites Credit Union makes no representation, warranty, undertaking or assurance of any kind (express or implied) with respect to the adequacy, accuracy, completeness or reasonableness of the information provided and disclaims all liability for any use you, your affiliates, connected companies, employees, or your advisers make of it. Ednites Credit Union accepts no liability whatsoever for any direct, indirect or consequential losses (in contract, tort or otherwise) arising from the use of this material or reliance on the information contained herein. However, this shall not restrict, exclude or limit any duty or liability to any person under any applicable laws or regulations of any jurisdiction which may not be lawfully disclaimed. Copyright 2021 ©Ednites Credit Union Plc. All rights reserved.
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