Centrus advises Southern on £250m Sustainability Bond and  £100m+ of new Sustainability Linked RCF 

Transaction Overview

Southern Housing Group (“SHG”) is one of southern England’s largest housing associations providing 30,000 homes for 77,000 people and offering a range of services to people in the communities in which they operate.

Centrus has been working closely with Southern as retained advisor over the past year, to develop and successfully deliver a multi-stage treasury and funding strategy that supports SHG’s ongoing development aspirations, liquidity requirements and sustainability objectives.

Centrus Solution

Centrus advised Southern on £300m own name sustainability bond issuance in October (£50m retained) supporting long term development aspirations.

Centrus has also supported Southern in arranging £100m of Sustainability Linked RCFs (SLLs), Southern’s first SLLs, along with extending a number of existing facilities.

The combination of the bond issue, additional bank liquidity funding, as well as achieving greater flexibility within a number of existing agreements, is that SHG now has a more dynamic treasury platform for future growth.

Features and Benefits

SHG will receive benefit from these SLLs, innovative new funding structures, that support SHG in achieving a number of ESG targets with reduced funding costs if these targets are achieved.

These new RCFs, along with the sustainability bond, support SHG’s ongoing sustainability strategy and align ESG aspirations with funding.

Bevan Brittan were Southerns’ legal advisors for the banking stream and Devonshires for the bond.

“Centrus has been invaluable in providing expertise, strategic advice and support for these transactions. From developing a clear, effective and detailed strategy to achieve our objectives for the medium term, to support in delivering both bond and new RCF funding, Centrus has provided the assurance, support and insight to ensure successful delivery at every stage of the process.”

Amanda Holgate, Chief Financial Officer – Southern Housing Group

“Centrus is delighted to have supported Southern achieve a range of treasury and funding objectives, including over £350m in new sustainability financing. This series of transactions provides a strong basis for Southern to deliver more homes, support its journey to net zero, continue to provide a key social role in its communities as well as aligning Southern’s funding with its ESG strategy and ambitions.”

Sam Goldman, Director – Centrus

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