- Erste Bank will receive €200 million in additional long-term financing from the EIB (European Investment Bank) for future housing investments.
- In the last six years, the EIB has provided Erste Bank with a total of €800 million for investment in housing.
- This is the largest support package ever granted by the EIB for the construction of subsidised and non-profit rental apartments in Austria.
- To date, this cooperation has enabled investments of €1.5 billion, and continues to provide long-term financing on preferential terms for subsidised and non-profit housing developers.
Under a new financing arrangement, the EIB Board of Directors has made an additional €200 million available to Erste Bank, on top of the previous €600 million, for subsidised and non-profit housing. These funds can be combined under a new initiative to not only address the lack of affordable housing in Austrian cities, but also to adapt the existing housing supply to the needs of youth and older individuals.
The expanded partnership is expected to support the construction of 4 000 new apartments and, at a total of €800 million, is the largest package for Austrian housing ever provided by the EIB, the financing arm of the European Union. With a term of 34 years, the long-term EIB financing will reduce financing costs for housing projects and help bring rental rates down.
Gerda Holzinger-Burgstaller, CEO of Erste Bank Austria, explained, “EIB investments help us deliver on our social mission of making housing affordable. The funding provided by the EIB is a multiplier for investments in non-profit housing. It’s a win-win situation for everyone. It lets Erste Bank offer affordable, reliable long-term financing, and those benefits are passed on to tenants.”
“The EIB is pleased to be expanding support for affordable housing across Austria with our largest financing package for this sector in the country to date. We are delighted to be working with Erste Bank once again to enable over €750 million in new housing construction projects that will provide high-quality housing at low rents for thousands of families,” EIB Vice-President Thomas Östros said.
€1.5 billion invested so far
In the last six years, the EIB has provided €600 million to Erste Bank for the construction of new subsidised or non-profit rental housing and the improvement of energy efficiency in housing throughout Austria. Thanks to the successful cooperation implemented to date, investments totalling €1.5 billion have already been made to build more than 7 100 new, non-profit rental apartments at 96 locations across Austria. This includes the construction of affordable apartments in Vienna’s recently developed Nordbahnhof district. Expanding this cooperation will increase the total investment volume to more than €2.25 billion.