Legal & General (L&G) has funded a new £85m investment with housing association, Anchor, which will use the proceeds primarily to fund the development of new affordable energy efficient homes.

The investment aims to help build an average of at least 500 homes a year over a rolling 10-year period.

Anchor is a not-for-profit provider of housing and care for people in later life with more than 35,500 social rented properties,12,500 homeownership properties, and 120 care homes. It serves more than 65,000 residents across 85% of local authority areas, from an estimated 1,700 locations across England.

Anchor and L&G have an established relationship, with investments dating back to 2014, and the new investment follows previous funding to Anchor completed in February of this year, taking L&G’s total private credit lending to Anchor to £100m.

L&G has structured the investment as a 15-year bullet senior secured note as part of a £100m bilateral shelf facility, which following this latest investment is now fully drawn.

Head of corporate private credit, Europe at L&G Asset Management, Steven Bolton, said that the UK needs to “urgently” drive up the delivery of all types of homes across all tenures.

“As well as a housing shortage, affordability proves challenging, so funding the delivery of energy efficient and affordable homes is ever more important,” Bolton said.

“There are 8.5 million people in England who can’t access the housing they need, and those in need of later living housing can often be overlooked, particularly given an ageing population.”

Anchor’s chief financial officer, Amanda Holgate, added: “There is a strong underlying demand for older people’s housing and care. Our development strategy is concentrated where the need is greatest and the supply least, namely social and affordable housing, extra care housing and care homes.

“We are pleased to be working with L&G so more people can have a home where they love living in later life.”

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