Client stories

Jigsaw’s debut sustainability bond to help cut emissions

Creating homes. Building lives

Jigsaw Homes owns and manages approximately 35,000 homes across the North-West, and East Midlands. The housing association, one of the largest in England, focuses on building, renovating, and managing affordable housing for rent and sale, with 82% of its turnover coming from social housing lettings. Having completed more than 3,000 new homes in five years up to March 2021, Jigsaw is aiming to build another 4,000 homes over the next five years.

In 2020, the housing association, an early adopter of the Sustainability Reporting Standard for Social Housing, carried out the ‘Jigsaw Conversation’, a wide-ranging consultation with residents, employees and other stakeholders to consult on its future direction. Based on the feedback, Jigsaw set out its Sustainability Strategy, which includes – amongst others the following objectives:  1) Reducing carbon emissions by reducing the energy demands of its homes and buildings and improving their fabric; 2) Building high quality homes with a low carbon footprint; 3) Empowering colleagues and customers to make environmentally informed decisions at home and at work; 4) Significantly reducing the amount of waste; 5) Increasing and improving access to well-maintained green spaces for residents. To achieve these aims, Jigsaw will need to invest around £535 million over the next 30 years.

In April this year, Jigsaw published its Sustainable Finance Framework.  Net proceeds raised under the framework - which received a Second Party Opinion (SPO) from S&P confirming it is aligned with the ICMA Green and Social Bond Principles, ICMA Sustainability Bond Guidelines, and LMA Green and Social Loan Principles – will mainly go towards the development of new homes with an energy rating of EPC B and above. 

Investors praise Jigsaw’s sustainability strategy

Looking to issue its inaugural Sustainability Bond under the new framework, Jigsaw turned to its longstanding banking partner NatWest to support the debut in the role of Sole Sustainability Structuring Bank, Joint Active Bookrunner, Documentation, and B&D.

Given the inaugural nature of this transaction and the importance to thoroughly introduce investors to Jigsaw’s credit story and sustainability strategy, the NatWest team advocated for a Global Investor Call and follow-up one-to-one meetings with key investors. 

Despite challenging market conditions, investors provided positive feedback, giving the housing association confidence to launch a 30-year debut sustainability bond. Strong uptake with a final orderbook of over £685 million underlined investors’ confidence in the housing association, which opted for a size of £360 million (£260 million on day 1, and £100 million retained), setting the coupon at 3.375%.

Championing communities and helping them to thrive

Paul Chisnell, Executive Director of Finance, Jigsaw Homes, commented: “We are delighted with our successful debut Sustainability Bond and the positive feedback and support we received from investors. The bond’s proceeds help us to deliver on our commitments to our residents in the years to come. We are very grateful to the NatWest team for their excellent support and advice, which was also a key factor in achieving such a successful sustainability issuance.”

Commenting on the issuance, George Flynn, Corporate Financing Solutions, NatWest, said: “We’re delighted to have been able to support Jigsaw with their successful debut in the sustainable finance market. Securing an attractive 30-year transaction in the midst of a challenging market, with support from high quality investors, bodes well for future Jigsaw Homes issuances. The result is testament to the strength of their credit story, as well as the agility and speed of the bond’s execution. We’re excited that we can actively contribute to social, economic and environmental progress in the UK through this and many similar transactions.”

Tom Gidman, ESG Advisory, NatWest, added: “Jigsaw Homes’ transaction demonstrates the pioneering role the social housing sector plays in the transition to net zero, and we are excited about the very successful outcome for our customer. Supporting this issuance is another example of our commitment to act as a sustainable, purpose-led bank that champions the communities we serve and helps them to thrive, as well as supports them on their journey to net zero.”


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