Wholesale investor information

Published: 5 June 2018

This page is intended to provide information for wholesale investors only.

Housing New Zealand is the biggest residential property owner in the country, owning or managing around 63,000 properties that house more than 184,000 New Zealanders.

Borrowing from debt capital markets 

Housing New Zealand’s Borrowing Protocol includes a limit on borrowing from sources other than the Crown.

Our housing portfolio has lumpy renewal periods – over 75 percent of our homes are reaching the end of their lives and need to be renewed over the next twenty years (2,250 per annum), with the remaining 25 percent being renewed over the following fifty years (300 per annum).

Our stewardship responsibility is to ensure our asset management plans are delivered on, including renewing and building modern, warm and dry homes which enhances our building stock.

Government entities with long-lived assets seeking financing from debt capital markets is not new in the New Zealand context – Housing New Zealand has undertaken such activity in the past and Transpower (the State Owned Enterprise which owns and operates the National Grid) is an active borrower in debt capital markets.

Accessing finance outside of the Crown provides the flexibility and appropriate level of control required for our stewardship responsibilities. In addition, the ability to access long-term financing independently allows us to enter into long-term supplier arrangements, providing the certainty for firms to invest for the future, employ more people and lower the cost of building homes.

Budget 2018 update 

As a result of Budget 2018 decisions, the Minister of Finance and the Minister responsible for Housing New Zealand have increased the limit on Housing New Zealand’s Borrowing Protocol from $1.08 billion to $3.05 billion.*

The increased limit reflects the Government’s plan to increase the stock of public housing by 6,400 homes over the four years to June 2022.

Housing New Zealand plans to issue around $1 billion of debt, prior to 30 June 2019, via its New Zealand Dollar Medium Term Note Programme.

* Note, the new $3.05 billion limit includes $2.9 billion of term debt required to meet the Government’s public housing plans over the next four years, in addition to $150 million of commercial paper to manage working capital requirements.

Credit rating

S&P Global Ratings (S&P) first rated Housing New Zealand in 1996. Credit ratings are assigned to both Housing New Zealand Limited (HNZL) and Housing New Zealand Corporation (HNZC). HNZL (the issuer) is 100% owned by HNZC.

The ratings are equalised with the New Zealand Government, reflecting S&P’s view that there is an ‘almost certain’ likelihood that the New Zealand government would provide timely and sufficient extraordinary support to HNZC in the event of financial distress.

HNZC and HNZL credit ratings – latest update 4 December 2017

Rating type Rating Outlook
Local currency LT AA+ Stable
Local currency ST A-1+  
Foreign currency LT AA Stable
Foreign currency ST A-1+  

Full S&P ratings reports:

A credit rating is not a recommendation to buy, sell or hold any securities and may be subject to suspension, change or withdrawal at any time by the assigning rating agency.

Our borrowing programmes

Medium to long term

HNZL has established a programme for the issuance of unsubordinated, unsecured medium term notes.

Short term

HNZL has a programme in place for the issuance of Commercial Paper, which has a term of less than one year. The programme has a limit of NZD 500 million.

Housing New Zealand bonds on issue

On 1 June 2018, Housing New Zealand issued, by way of syndication, $250m of bonds maturing on 12 June 2023 (at 2.97% per annum) and $250m of bonds maturing on 12 June 2025 (at 3.36% per annum).

Further details in the attachment below:

Final term sheet [PDF, 631 KB]

Housing New Zealand publications

Investor Update

May 2018 [PDF, 2.9 MB]

Other publications

Further enquiries

If you have any enquiries, email us at treasury@hnzc.co.nz. For media enquiries, email media@hnzc.co.nz

Disclaimer

The information on this webpage is issued by Housing New Zealand Limited for informational purposes. To the extent that this webpage refers to an offer of securities, no offer is made to anyone accessing this webpage outside of New Zealand and otherwise than in compliance with any applicable securities laws or regulations. To the extent that this webpage refers to any offer of securities to any person in New Zealand, such offer will be made to only wholesale investors and in accordance with the Financial Markets Conduct Act 2013 (FMCA).

Users accessing this webpage acknowledge and accept that they will comply with any applicable securities laws or regulations (including, without limitation, the FMCA).

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