Hundreds of primary and secondary school pupils across the north east of England will benefit from 12 brand new schools being supported by a GBP 46.3 million (US$ 60.61 million) long-term loan from the European Investment Bank. The new schools will be built on either existing or new sites and construction is expected to start in the coming weeks.

The new schools comprise the first batch of five regional batches of new schools to be built under the Priority School Building Programme (PSBP). The European Investment Bank is expected to support construction of a total of 46 new state primary and secondary schools under the initiative and provide around GBP 274 million (US$ 358.69 million) of overall support. The loans from Europe’s long-term lending institution will be for around 25 years and represent around 40% of the overall project cost.

Twelve schools will be built in the north-east in the first privately funded batch of the PSBP with a total of the GBP 112 million being invested.

The six primary schools are Mandale Mill in Stockton on Tees, Hylton Castle Primary and Shiney Row Primary in Sunderland, and Lingey House, Roman Road and Front School Community Primary schools in Gateshead. The six secondary schools are Bedlingtonshire Community High and The Duchess’s Community High schools in Northumberland, Laurence Jackson School in Redcar and Cleveland, Longbenton Community College in North Tyneside and Seaham School of Technology in County Durham.

By grouping school development schemes aggregating funding requirements, the Education Funding Agency has been able to access cheaper finance, and streamline procurement for each batch of schools. 

The PSBP is a centrally managed programme set up to address the needs of the schools most in need of urgent repair. Through the programme, 260 schools will be rebuilt or have their condition needs met by the Education Funding Agency (EFA). Senior debt will be provided by the European Investment Bank and senior bonds subscribed for by Aviva Annuity UK Limited.

Aviva and the European Investment Bank are each expected to provide around 50% of senior debt and INPP will provide mezzanine debt. Amber Infrastructure will act as Loan Administration Agent and Corporate Services Provider. Ashurst LLP (legal) and HSBC (financial) have advised the EFA on the procurement of the aggregator.