Barratt and London & Quadrant set up joint venture

18th Dec 2013 07:41

Housebuilder Barratt Developments has set up a joint venture company with affordable housing association London & Quadrant to provide greater capacity to build large residential projects in the capital. The FTSE 250 listed company has already developed one residential block in Aldgate with L&Q with 27% affordable housing, and has jointly acquired and contracted on three other sites with lower shares of affordability, which will be transferred into the new 'BDWZest' vehicle. Barratt's Chief Executive, Mark Clare, said: "L&Q has proved to be a strong commercial partner and by working together we have been able to broaden our operations in the London market. "This new alliance reinforces that position and gives us even greater financial capacity to seek out and secure large scale and complex opportunities." A new five year revolving credit facility of £120m has been arranged for BDWZest, which will initially repay a £21m loan from L&Q that was made to the Aldgate development in 2011. The facility will then be available to the JV for land and build expenditure, although the companies stressed that the JV will continue to be primarily equity funded by Barratt and L&Q.Barratt's share of the gross asset value of the three existing JV entities as at 30 June 2013 was £119m.L&Q, which has the largest development programme of any registered provider operating in the London area, works with some 100 local authorities, with over 75% of their homes located in London boroughs.OH