The funding from the private placement will enable the building of 400 new affordable homes over five years and significant investment to Cairn’s current homes, including the remodelling of their retirement courts.

The 35-year private placement will be drawn down in two stages over the next two years, with the first tranche transferring this week. Cairn secured significant interest from several investors and all the offers were at highly competitive rates and terms.

Cairn has been supported in securing the deal by Santander Global Corporate Banking and legal advisors Harper Macleod. Cairn’s current loan portfolio will continue to be supported by its existing lenders, Abbey National Treasury Services and the Royal Bank of Scotland, who have both been working in partnership with Cairn for almost 20 years.

Jason MacGilp, Cairn’s chief executive, said: “We are delighted to have reached this deal. It’s a real vote of confidence in the financial strength, the management and governance of Cairn and our plans for the future. Securing this long term, low rate funding will allow us to invest in homes and communities across Scotland to help those desperately needing affordable housing as well as significantly improving the investment to our existing homes.”

Tony Fordham, head of private placements at Santander, added: “Santander has worked with Cairn Housing for the last 18 years. We are delighted to have helped them with their debut capital markets transaction, which provides a long-term and cost effective way to fund its social housing programme.”