SOCIAL housing finance provider Carduus has announced it will close its first fund in the next few weeks despite falling short of its £200 million initial target.
Brian Gilmour, managing director, said demand for finance from providers of social housing was subdued but had reached close to £100m.
Registered social landlords (RSLs) who have signed up to borrow from institutional lenders through Carduus will “have their money by September”, he said. He was unable to confirm the final figure at which the fund will close as he expects some attrition among RSLs.
He said: “After taking some time to get there – because we have a conservative, slow moving customer base – we are definitely going ahead.
“There is a big demand from investors, but social landlords are still less keen to borrow. The RSLs we are working with will get their money by September.”
He confirmed the interest rate will be 4.75 per cent.
“Because of demand in the market, we can go. The housing association sector is still viewed as a safe prospect. We decided that rather than try and wait around an extra two or three months to get those extra RSLs to get us to £150m to £200m, that what we would do is capitalise on the excellent interest rates we can get just now.”
Carduus funding will mainly be used by RSLs to refinance existing loan arrangements, paving the way for the housing groups to eventually build new homes.