The Pension Insurance Corporation has completed a £60m investment in long-dated, senior secured debt, issued by the Yarlington Social Housing Group.

The transaction is £60m in size with a deferred drawdown, which will lower the cost of carry.

Furthermore, the profile has been matched to PIC’s pension liabilities and the funds will be used by Yarlington to finance new housing developments and to refinance current debt.

TradeRisks acted as arranger and dealer of the bond issue. Overall, PIC has invested almost £1bn in social and affordable housing in the UK.

The Yarlington Social Housing Group is a regulated housing association with over 10,000 properties across Somerset, Devon and Dorset.

Yarlington Housing Group CEO Gary Orr said: “We are delighted to have secured this additional long-term funding. The bond issue, and our financial results, places Yarlington in a strong and secure position to deliver our ambitious commitments set out in our Next-Gen corporate strategy. It reflects the confidence by the capital markets in Yarlington’s strategic and financial plans. Underpinned by our strong governance, consistent operating margins and dedicated staff, this financing arrangement will play a major role in delivering our strategy, at a time when affordable housing is needed across the south west.”

PIC head of debt origination Allen Twyning said: “We are very pleased to have worked with Yarlington Housing Group on this transaction. The investment provides an attractive risk profile in an area of high demand for social housing. In addition the maturity profile is well-suited to our liabilities. The team at Yarlington impressed us with its expertise, knowledge and strong governance and we are delighted to continue our commitment to supporting social and affordable housing.”

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