Date published: 04 July 2025
Stonewater, one of the UK’s leading housing providers, has agreed a £75m loan with its existing lender, The Royal Bank of Scotland, which is part of the NatWest Group, to support the delivery of its 2030 corporate plan and ongoing development programme.
The 10-year variable-rate loan includes a fixed-rate period for the first six years via a loan-linked ISDA agreement, minimising interest rate risk.
In line with Stonewater’s commitment to sustainability, the loan incorporates sustainability-linked performance targets. These offer a reduced interest rate should Stonewater meet agreed environmental performance indicators across its existing portfolio and new homes, as well as broader organisational benchmarks.
These KPIs, which are published in Stonewater’s ESG report, are based on: the percentage of existing homes that have an Energy Performance Certificate (EPC) rating of ‘C’ or above; the percentage increase in its annual Sustainable Homes Index for Tomorrow (SHIFT) score; and the percentage of Land and Build Homes that have a minimum Standard Assessment Procedure (SAP) score of 86 or above.
The £75m will contribute towards the delivery of Stonewater’s development pipeline and its wider corporate plan over the next five years.
Savills Financial Consultants and Devonshires advised Stonewater, which owns and manages 40,000 homes across the country, on the transaction.
Anne Costain, Chief Financial Officer at Stonewater, said: “This additional funding will be integral to our work delivering our 2030 corporate plan and ensuring our work to build safe and warm homes for customers to enjoy for years to come.
“Continuing our strong and enduring relationships with financial partners like The Royal Bank of Scotland is vital to the continuation of our dedicated work to providing affordable housing across the country. We’re grateful for the ongoing support and the guidance and legal expertise of everyone involved.”
John Horton, Relationship Director at NatWest Real Estate Finance, said: “We are delighted to support Stonewater with funding which will enable the social housing provider to move forward with its exciting growth plans.
“We have recently announced our ambition to provide £7.5 billion lending to the UK’s social housing sector to support the development of new homes and improvements to properties across the UK. This latest deal with Stonewater reaffirms this commitment.”
Dominic Brindley, Director, Financing & Risk Solutions at NatWest, added: “In line with a trend we’re continuing to see across the sector, Stonewater elected to put in place a Loan Linked ISDA to hedge the interest rate risk associated with this transaction.
“This provided Stonewater with a high degree of flexibility on how to execute their hedging strategy, something that is critical in the current market backdrop.”
Alice Overton, Partner at Devonshires, said: “It was a pleasure to advise Stonewater on this transaction and helping to ensure it is set up to take advantage of hedging opportunities in the current market.
“We are delighted to play a part in the association continuing to deliver affordable, safe and sustainable homes and to make a difference to the communities it serves.”
George Flynn, Director at Savills Financial Consultants, said: “We are delighted to have partnered with the Stonewater team on another important financing project. This transaction enables Stonewater to access competitively priced bank financing with a simple and effective hedging solution.
“It is great to continue to support Stonewater in another funding project to help deliver the aims in its 2030 corporate plan.”