A Manchester-based housing association has secured £50m in new funding to build more homes and carry out fire safety works on some of its high-rise blocks.
Irwell Valley Homes, which manages around 7,500 homes across Greater Manchester, has agreed the facility with Danish-owned Danske Bank UK.
The funding will help build 1,260 new homes over the next five years, including social rent, affordable rent and supporting housing tenures, the landlord said.
The money will also be spent on “important fire safety works to a number of high-rise buildings” over the next three years, Irwell Valley said.
In its last full financial year, Irwell Valley spent £1.5m on replacing fire doors and compartmentation and £400,000 on installing sprinklers, according to its published accounts.
Danske Bank was previously known as Northern Bank – one of Northern Ireland’s oldest financial firms – before taking on the name of its Danish parent when it was acquired in 2012.
At the time, Danske said it was keen to develop its presence in the English social housing sector, building on its then circa £250m loan book with Northern Irish associations.
Mark Canning, head of Danske’s corporate relationship team at Danske Bank, said it is now eyeing the sector for future finance deals.
“As part of our strategic growth plans we will be more active in helping the sector across the rest of the UK moving forward,” he said.
Helen Nicholson, executive director of finance and governance at Irwell Valley, said the funding would help deliver a “key strategic goal of building more homes to meet the growing needs of the communities we serve”.
She added: “Importantly, the terms agreed with Danske Bank will enable us to carry out fire remedial work on existing sites over the next few years.”
Last December Irwell Valley was downgraded to a V2 viability rating by the regulator, but retained its G1 governance status. In its assessment, the regulator said spending extra money on its existing stock had led to a “worse than forecast” financial performance for the association.
It also flagged that “spending on remedial fire safety work over the next two to three years… provides a continuing material exposure to manage”.
In the financial year to the end of March 2020, Irwell Valley reported a group surplus of £955,000 off a turnover of £35.5m.
The landlord is part of a joint venture of 10 Greater Manchester associations, launched in 2018, aiming to deliver more social housing in the North West of England.
Centrus acted as financial advisor to Irwell Valley on the Danske Bank deal.