SCOTLAND'S biggest social housing landlord has returned successfully to the bond market, raising a further £50 million to boost its house building activities at a record low borrowing cost.

Wheatley Group, the organisation behind Glasgow Housing Association, has raised the funds by issuing a new public bond at an "all-in cost" of 3.542 per cent.

The company said it is lowest ever rate of interest secured by a housing association bond, and allows it to press ahead with plans to build 3000 homes in Glasgow and around central Scotland.

The £50m raised by the fresh bond adds to the £250m amassed by Wheatley in November, when it became the first social housing group to raise funds via a bond on the capital markets.

Wheatley, which owns and manages 72,000 homes across 12 local authority areas, said in November that the funds raised by that bond would allow it to build 2800 affordable homes in Glasgow and central Scotland. The latest bond has lifted the target to 3000.

The new bond, retained and priced last week, was achieved at an all-in cost to Wheatley of 3.542 per cent. This is said to offer investors a spread of 1.4 per cent over gilts or government bonds.

Wheatley, which said its bonds have attracted institutional investors such as pension schemes and insurers, was rated AA- by the credit rating agency Standard and Poor's in 2014.

Meanwhile, as well as raising £50m through a new bond, Wheatley has sealed a £50m commercial finance arrangement with its backers to increase the supply of homes for private rental.

It said the deal will allow subsidiary Lowther Homes to grow its current portfolio of nearly 500 homes in areas such as Leith and Glasgow's west end over the next four years.

Group chief executive Martin Armstrong said: "Market conditions, combined with strong confidence in Wheatley by institutional investors, created the perfect opportunity for us to issue the £50m retained last year.

"The additional funding will allows us to press ahead with our plans to supply almost 3000 new affordable homes in Glasgow and across central Scotland, and allow us to continue to deliver excellent services."

Wheatley Group chairman Alastair Dempster said the latest bond issue was a "massive vote of confidence" in the group and Scotland.

Mr Dempster said: "We were absolutely delighted by the success of our debut issue in November.

"The record low coupon achieved today represents outstanding value and will enable us to press ahead with our plans to play a major part in delivering more affordable housing."

Wheatley announced in November that it had become the first Scottish housing association to raise funds on the capital markets after issuing a "landmark" bond. It was also the first Scottish issuer to access the bond market following the independence referendum in September.

The response from investors was such that Wheatley closed the offer period for the 4.4 per cent bond closed early having been oversubscribed by £125m. That bond is scheduled to mature in 2044.

A spokesman explained Wheatley had the capacity to raise £300m from the initial bond, it only issued £250m. It retained £50m for sale at a later date, which has happened now.

The spokesman noted that the affordable homes planned by Wheatley over the next seven years will be in communities where its four Registered Social Landlords operate. The planning process is already under way for potential developments.

Speaking after Wheatley had raised £250m in November, David Mackay of Royal Bank of Scotland's debt capital markets team, who worked on the issue, said: "The deal represents a fantastic result for all those involved in the transaction and has aided Wheatley to secure long-term financing that will support the growth and the development of the organisation."