The National Wealth Fund (NWF) has today announced a financial guarantee of up to £400 million to cover a series of new loans provided by NatWest Group to registered providers for the retrofit of social housing stock in the UK.
The lending aims to help registered providers of social housing reduce energy consumption and accelerate the decarbonisation of their housing stock. In line with NWF’s previous social housing retrofit investments, the loans will be used on eligible measures for retrofit, including the installation of energy efficient heating and lighting, insulation, renewable energy generation, ventilation and heating controls, as well as work on resilience measures and biodiversity.
The NWF will guarantee 80% of each retrofit loan originated by NatWest Group up to £500 million for a total commitment of up to £400 million. The guarantee commitment will help to enable private capital to be mobilised into the social housing sector at both scale and an attractive price, removing a significant barrier to the deployment of funds within the sector by increasing access to financing for registered providers of social housing.
There are 4.5 million social homes in the UK with 2.9 million owned by private registered providers.¹ Of these homes in England and Wales, 28% have an EPC rating of D or worse and 10% do not meet the Decent Homes Standard.² The proposed loans aim to help accelerate retrofits and improve these figures.
NatWest Group brings significant expertise and market share in the social housing sector, with a strong regional presence across England, Scotland, Wales and Northern Ireland, enabling it to offer retrofit solutions to registered providers right across the UK. Support from the NWF has enabled NatWest Group to bring these fully unsecured mid-to-long duration loans to market, building on the Group’s green retrofit pilots, to roll out financing at scale.
John Flint, National Wealth Fund CEO, said:
“Everyone should be able to live in a warm home with affordable energy bills. However, the scale of the retrofit challenge facing the social housing sector is clear and significant investment is needed now to ensure that residents across the UK have homes fit for the future. The NWF has an important role to play in mobilising the private finance that will underpin this transformation. Our support for NatWest builds on our work with other lenders, leveraging their reach and expertise to ensure that as many registered providers as possible have access to attractive financing.”
Paul Thwaite, CEO of NatWest Group, said:
“NatWest continues to be a leading lender to the UK social housing sector, and last month we upgraded our lending ambition to £7.5 billion as demand continues to grow. Working with the National Wealth Fund on deploying £500 million of new loans means we can help retrofit more social homes across the UK at pace – supporting those who need it most.”
