Kingdom Housing Association

QMPF has advised Kingdom Housing Association in completing its debut private placement, raising £85m provided for a period of 30 years with an immediate drawdown of £35m and £50m deferred for 12 months. The funding secures Kingdom Housing Association’s development programme of over 1,100 homes until the end of 2019-20.  Kingdom’s private placement is unprecedented in the Scottish Sector for its size and the strength of investor interest.  Kingdom secured significant interest from several investors, resulting in a heavily oversubscribed bid book and all the offers were all at competitive rates and terms.  Margins were exceptionally competitive coming in at a level which was comparable to recently issued public bonds and existing trading levels of sector comparables in both the public bond and private placement market.

QMPF supported the transaction from the outset, procuring the wider advisory team and lead arranger (Natwest Markets), reviewing the funding requirement, supporting the management team in preparing for the process and providing direct support to the Kingdom Housing Association Board to ensure they were aware of the process and implications for the business. QMPF provided critical challenge through the private placement process and delivered clear, evidenced and robust analysis of offers received giving confidence to our client that the process could drive maximum value to them.

Nick Pollard, Director of Corporate Support Services, Kingdom Housing Association, said “Kingdom we relied heavily on our advisors in our debut private placement deal. QMPF LLP, who were new to the social housing sector and Kingdom supported us throughout the process with treasury management advice. QMPF’s experience in other sectors similar to the not for profit social housing sector were a distinct advantage in appointing them. We found the team at QMPF to be extremely knowledgeable and experienced providing excellent guidance and support as and when required to officers and the Board of Kingdom, not least when evaluating offers made to Kingdom. This was invaluable during the process, especially given the short timescale within which we completed the deal. We are delighted to have achieved such a strong vote of confidence by the institutional investor market in Kingdom both in terms of the volume of bids and the value received reflecting the strength of the credit offering Kingdom gave investors. This could not have been achieved without QMPF LLP.”.

Graeme Tough, Director, QMPF, said “QMPF is delighted to expand its debt advisory experience into the Social Housing sector. The need for alternative sources of long term funding in the sector and institutional appetite for high quality credits has driven significant housing association interest in the private placement and public bond markets and QMPF’s extensive experience raising funding from a similar investor pool offers a fresh approach and perspective for clients. The success of the transaction and extent of institutional interest in the offer are testament to a well prepared, structured and delivered transaction and the inherent strength of Kingdom Housing Association and its management team.”

Our information sheet ‘Get Geared Up: 10 Practical Ways to Prepare for a Private Placement in the Social Housing Sector’, is available here