Pension fund makes £8m loan for low carbon homes in Sheffield
An £80m cash pot set up by a pension fund has made its first loan - £8m for 52 low carbon homes in Sheffield.
The South Yorkshire Pension Fund is giving sustainable developer Citu the money for houses at Little Kelham in the city centre. They will be heated by carbon neutral renewable energy it says.
It will be the second phase of homes at the site which also includes homes, offices, bars, restaurants and refurbished buildings.
The pension fund announced the pot in March and said it was investing in local projects for the first time to benefit the area where members live and the prospect of good returns due to the health of the economy.
The Local Government Pension Scheme in South Yorkshire is worth £8.2bn and has 160,000 members working for councils, police and fire authorities and academy schools.
Coun Mick Stowe, chair of South Yorkshire Pensions Authority, said: “We are pleased that the first loan being made from this allocation supports the regeneration of such an historic site in Sheffield and involves the delivery of much needed housing constructed in a way that is adapted for a low carbon future.
“This shows that it is possible to both achieve our objective of making a financial return for our scheme members while delivering benefit to our local area.”
Fraser Stride of Citu said: “We’d like to thank the Fund for enabling us to take forward the next phase of Little Kelham following the huge success of phase one which has helped transform this part of Sheffield.
“It is a new neighbourhood where people can live, work and spend their leisure time.”
The funding is administered by CBRE.
Will Church, senior director, CBRE Capital Advisors, said: “This loan is significant as it builds upon a loan the SCR Jessica fund made four years ago for the existing commercial space at Little Kelham, a strategically important site for the region.
“The creation of the South Yorkshire Pension Fund broadens the investment scope of SCR Jessica and has enabled investment into alternative sectors whilst staying true to the core principles of investing in low carbon projects that support regional growth.”