First Base raises £250m for mixed-tenure flats

Developer First Base has secured £250m of funding for four projects containing a total of 900 units.

The company, which is backed by Australian developer Lend Lease, announced this week that it had secured the money from investment bank Morgan Stanley and Uberior, a subsidiary of HBOS.

Lend Lease and HBOS provided the funding for First Base’s first scheme at Adelaide Wharf, in Shoreditch, east London, which is under construction. It has four other schemes on its books that were allocated to it by English Partnerships (EP) as part of the London Wide regeneration initiative.

Morgan Stanley and Uberior are providing a mix of equity and debt finance. It is believed to be the first time that such a forward funding arrangement has been agreed on a scheme in which EP has a stake as a joint venture partner.

Elliot Lipton, a director of First Base, said the financing deal would reduce borrowing costs. He said his company would use its savings to increase to 350 the number of key worker units in the four schemes. This is a 25% increase on the original figure.

The extra cash means that flats originally earmarked for private sale will be sold on a shared ownership basis to key workers.

Lipton said: ”By looking at the sites as a portfolio of four, we are beginning to develop real economies of scale and ploughing that back into the affordable housing.”

Building learned this week that First Base has beaten Countryside Properties to redevelop East Greenwich Hospital.

EP has selected First Base and Lend Lease as its preferred developers for the Heart of Greenwich scheme, which is to deliver 800 new homes.