Harworth Group has made £45m of land acquisitions and increased its loan facilities to £100m.
It bought four brownfield and greenfield land sites, totalling 299 acres, across the North and the Midlands.
In total the acquisitions, in Nufarm, Bradford; Glaxby, North Yorkshire; Cinderhill, Derbyshire; and Bardon Hill, Leicestershire, provide the potential for 3,000 homes and more than 1m sq ft of commercial space.
Harworth will undertake masterplanning and remediate the land.
The acquisitions have been funded using the company’s existing revolving credit facility, which has been extended from £75m to £100m, with Santander providing an additional £25m alongside the existing £75m Royal Bank of Scotland facility.
The terms and covenants of the facility remain unchanged with a margin of LIBOR plus 210bps and expiry in February 2023. Following the acquisitions, more than £20m remains undrawn.
Harworth’s loan to value is expected to remain in the 10% to 15% range.
Owen Michaelson, chief executive of Harworth, said: “We are expanding our strategic land bank to deliver value to our shareholders through clear, long-term value-add opportunities, while both securing additional income and maintaining low gearing and financing headroom.
“Our confidence in the strength of, and the outlook for, our principal markets in the North of England and Midlands is underpinned by the continued undersupply of new homes and commercial space in the face of high levels of demand from housebuilders and commercial occupiers.”
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