Octopus Real Estate and Homes England launch Greener Homes Alliance

A new £175m Greener Homes Alliance will provide loan finance and expert support to SME housebuilders, enabling them to build more high quality, energy efficient homes across England.

The Alliance will provide loans of between £1m and £20m to finance new SME development projects, with funded homes required to achieve a minimum Energy Performance Certificate (EPC) rating of B.

Developers will benefit from increasing interest rate margin discounts as the energy efficiency of the homes increases above a B rating, with homes achieving an EPC rating of A benefitting from interest rate margin discounts of 2%.

Before starting their developments, SMEs will also benefit from free expert advice from sustainability consultants McBains and Octopus Energy.

Peter Denton, chief executive at Homes England, said: ‘This new partnership, the latest in a series of impactful lending alliances, will give smaller housebuilders both the funding and the knowledge needed to build more sustainable homes. The Greener Homes Alliance brings developers and lenders closer together, providing affordable finance, improving knowledge sharing and creating new paths to net zero.’

Benjamin Davis, CEO of Octopus Real Estate, added: ‘Creating more energy efficient homes across the United Kingdom is vital if we’re to make progress towards net zero. Our joint venture with Homes England will help meet this increasingly urgent need to develop more sustainable homes.

‘The Alliance will provide access to funding and expertise to help developers ‘go green’ when making decisions for their developments. Given the public are more in tune than ever before about how energy efficient their homes are, and in turn their own impact on the environment – the opportunity for developers building greener homes is huge.

‘As a B Corp, Octopus Real Estate is committed to our impact goals and the opportunity to work with the real estate sector, alongside institutional investors, to create choice for developers to future proof developments and drive the green acceleration of the property market.’

In related news, households will benefit from £5000 government grants to help install low-carbon heating systems, as part of more than £3.9bn of new funding to decarbonise heat and buildings through the Heat and Buildings Strategy.

Photo by James Feaver