Sigma Capital partners with UK gov to accelerate rental homes development
Shares in urban regeneration developer Sigma Capital plummeted more than 13% on Friday afternoon when the AIM-listed company announced it had agreed a loan with the Homes and Communities Agency to accelerate construction at its rental homes development.
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The company agreed to a £45m revolving credit facility with the public body of the Department for Communities and Local Government, which will be used by Sigma to ramp-up delivery of its self-funded rental homes portfolio, worth over £60m.
The rental homes will be directly owned by Sigma and is part of HCA and the government's initiative to make more homes available across England amid a housing shortage.
Chief executive Graham Barnet said the additional financial resource, alongside its other funding partners, will help the company to realise its ambitions to deliver residential development and urban regeneration housing across all the key economic regions in the UK.
Sigma launched its self-funded residential development and urban regeneration initiative in December 2015, with this new venture complementing its existing activities.
Since November 2015, the company has built about 800 new homes for rent, through its managed or self-funded activities and a further 1,300 new rental properties are currently at various stages of construction.
Shares in Sigma Capital were down 13.47% to 72.25p at 1349 BST.