Funding / Real Estate
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Development lending Reading time: 1 min

Development of 247 low-carbon homes at the Climate Innovation District in Leeds

£26 million development loan

The finance

We provided a £26 million fixed rate development facility to Citu, a low carbon residential housebuilder. The loan covered the refinancing of existing debt, and will fund the remaining construction costs, professional fees and associated costs required to complete and sell the units. The facility also allows recycling of sales proceeds to accelerate the delivery of units across the scheme.

The result

247 residential units – comprising of 161 apartments, 69 houses, and 17 affordable homes – as well as 6 commercial units will be delivered on the banks of the River Aire close to Leeds city centre. The scheme forms part of the Climate Innovation District, which will see over 900 high quality, low-carbon, energy efficient homes built.

All the properties will be delivered using Citu’s own on-site manufacturing facility that produces a timber-framed component system of building, originally designed in collaboration with local Leeds Beckett University.

The completed units will include a Mechanical Ventilation Heat Recovery (MVHR) system which captures and recycles heat from the home. The properties will also benefit from green roofs, rainwater collection, photovoltaic solar panels, and fully electric heating, with no gas boilers. Citu estimates that on average each home will save 4 tonnes of CO2 per year compared to traditionally built homes, plus around 60 tonnes of embodied carbon per home.

“It’s essential that we change the way we live in our cities. At Citu we develop places that encourage and enable bold change, so we look for long-term funding partners that share this vision. We are pleased to be on that journey with Octopus. Together, we’re building a legacy for the city of Leeds and proving that essential change is both achievable and deliverable for a better, lower carbon future.”

Chris Thompson, Founder, Citu

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Through our Greener Homes Alliance initiative, we provided a £10.7 million fixed rate development facility in conjunction with Homes England. The Greener Homes Alliance offers interest rate discounts for developments where all homes are delivered with a SAP score of 85 and higher, with the highest discount set at 2% for homes delivered with a SAP score of 92 or higher (EPC A rating).