Developer to expand student portfolio following £56m ‘green loan’

The Holbrook building
X The Business Desk

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Liverpool-based Downing, a key developer of purpose-built student accommodation (PBSA), is significantly expanding its rental portfolio with a £56.5m green loan from HSBC UK.

The sustainable finance funding package has enabled Downing to retain the 24-storey Holbrook building, one of its latest flagship developments, as an investment asset, adding it to the group’s emerging portfolio of rental student accommodation.

The Holbrook development in Acton, West London, completed in September 2019, and has 497 beds across a mixture of shared flats, studio apartments and affordable rooms.

The property achieved full occupancy ahead of opening with the majority of the scheme direct let and the affordable allocation leased to Imperial College London.

Downing will now hold the scheme, while continuing with other ambitious PBSA developments in London, Manchester and other major UK cities.

The Green Term Loan to Holbrook, which has been built to a BREEAM rating of ‘Very Good’, follows the EMEA and Asia-Pacific Loan Market Association’s Green Loan Principles (GLP) published in March 2018, to encourage and facilitate environmentally-friendly economic activity.

HSBC UK’s sustainable finance offering helps businesses meet their environmental goals.

Simon Garnett, Downing finance director, said: “Downing is undergoing a sustained period of growth, building on our market-leading portfolio, outstanding reputation and strong presence across the UK’s leading cities.

“HSBC UK’s support will enable the business to continue to move forward and expand our portfolio of outstanding, environmentally sustainable developments.”

Kevin Dawson, relationship director for housing, corporate real estate, HSBC UK, said: “We have a long relationship with Downing, having provided development funding in the past, so we’re delighted to support the business realise its ambitions.

“The Holbrook site will make a fine addition to the group’s growing portfolio. We look forward to backing Downing as it continues to scale up its presence across the UK.”

Natalya Tueva, HSBC UK’s director of sustainable finance, said: “According to the International Energy Agency, buildings consume 36% of the world’s energy and contribute up to 40% of greenhouse gas emissions.

“Our financing will support Downing’s commitment to ensuring sustainability throughout all sectors of its business by delivering sustainable solutions for its teams, customers, supply chains and stakeholders.

“HSBC is committed to helping businesses globally transition to a lower carbon economy having made a public commitment to provide $100bn of sustainable financing and investment by 2025.”

Downing has more than 30 years’ experience in the sector and has developed in excess of 30 student accommodation schemes across the UK with a joint gross development value of £1.5bn.