Azora secures €640 million to grow affordable resi platform

Azora has strengthened its focus on sustainable and affordable housing. The Spanish investment and asset management company has secured a €640 million financing packaging for Nestar, its affordable residential rental platform.

The new loan will be used to extend existing debt and to finance upgrades to the 8,600-unit Nestar portfolio with a capex and repositioning plan. The financing framework also includes a €40 million green loan to fund the acquisition of new energy-efficient homes that meet high standards of sustainability.

Concha Osácar, Founding Partner, Azora

“The signing of this agreement allows us to take our strategic plan forward for our affordable residential rental platform while also mitigating against potential financial risks over the next five years,” said Concha Osácar, founding partner, Azora. “This is an important achievement at a time of market uncertainty, with rising interest rates creating an environment where access to financing is becoming more restrictive.”

The deal also highlights, “the strong relationship Azora has with its lenders, alongside their recognition of our ability to manage rental housing in Spain,” she added.

The refinancing was agreed with a group of Spanish and international banks and insurers, including Natixis Corporate & Investment Bank, Banco Santander, Crédit Agricole, ING, Deutsche Bank and Banco Pichincha España. The package has a five-year maturity and is benchmarked to 3-month Euribor plus a spread of 175 basis points.

“When we created the Nestar platform over 18 years ago, it was with the aim of providing an outstanding affordable rental management platform that offered modern homes, quality designs and high levels of tenant services while also helping to alleviate Spain’s chronic housing shortage,” said Javier Rodríguez Heredia, head of real estate, Azora. “This agreement not only extends the platform’s debt maturities by five years, it also provides an additional, direct €40 million green financing facility for important ESG asset improvements that will have a direct impact on our customers.”

Javier Rodríguez Heredia, Head of Real Estate, Azora

Azora’s affordable residential rental platform is the largest private portfolio of affordable rental housing in Spain, reflecting Azora’s efforts to modernise and professionalise the BTR sector in Spain.

The company has developed more than 8,600 homes as part of its Nestar platform, with some tenures offering rents as low as €275 per month.  Since its inception, it has provided rental homes to more than 40,000 families, making a significant contribution to Spanish society through the development and management of high-quality affordable homes in a country characterized by a significant supply-demand imbalance.

Nestar’s management is focused on the well-being of its tenants and the planet and on its goal of facilitating the creation of homes with the highest quality standards at an affordable price.

The funding that has just been agreed helps to reaffirm the company’s commitment to its tenants, said Rodríguez Heredia, by providing new services and upgrades and adapting the product to a more demanding market that increasingly requires a close and professional service that improves the tenant experience and contributes to the creation of sustainable communities.