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ARA unit awarded £3b affordable housing guarantee scheme in UK
ARA Asset Management on Sunday said that its subsidiary, ARA Venn, has been appointed the exclusive manager of a new £3 billion (S$5.26 billion) Affordable Housing Guarantee Scheme by the UK Ministry of Housing, Communities and Local Government.
ARA Venn is an investment manager in European real estate private debt.
The scheme is expected to support the delivery of around 17,000 critical homes for lower-income families, and alleviate the issue of housing affordability in the UK, especially amid the economic uncertainty.
The scheme will provide £3 billion of cost-effective long-term loans, of up to 30 years, to registered providers developing the new affordable homes.
ARA Venn will be responsible for establishing and managing the scheme, including the origination, underwriting and ongoing management of the loans, and developing and managing a government guaranteed bond programme to efficiently fund them.
While initially set for £3 billion, there is an option to increase the scheme to up to £6 billion.
Currently, ARA Venn also manages the successful £3.5 billion Private Rented Sector Guarantee Scheme, a similar lending scheme focused on the private rented sector, on behalf of UK's housing ministry.
ARA Venn said that the latest scheme deepens its collaborative relationship with the UK government to support the sustainable development of its housing sector. Both schemes also underscore ARA's commitment to its environmental, social and corporate governance.
John Lim, ARA Group CEO, said: "ESG is a big part of the ARA Group, which strives to make a positive impact on the communities that it operates in, and the schemes reflect ARA's strong commitment to long-term responsible investment and creating social good.
"We are pleased to use our core strength as a highly experienced real assets fund manager to contribute towards providing housing affordability in the UK."