Over the past two years, we have seen a sharp increase in new sources of long-term debt finance for not-for-profits. While the high street banks may still be finding it difficult to lend for more than 10 years, there are many investors who are more than ready to fill the gap. These institutional investors are actively looking to place low risk, long-dated debt and are attracted by a sector that is seen as stable and highly regulated. In 2012 we advised University of Cambridge on its £350 million public bond, followed soon after by the £300 million public bond issued by University of Manchester. Both of these bonds were more than four times over-subscribed and so there is clearly unfulfilled demand that can be tapped by other not-for-profit issuers.

But what if you don't want to borrow such large sums? Is there a solution for the smaller issuer? One possible solution may be to use an aggregated structure and in January this year, we advised a group of 18 Cambridge Colleges on an aggregated private placement. The Colleges raised in total £150 million through a special purpose vehicle. The proceeds were on-lent to the Colleges on a standalone basis, so that no College cross-guaranteed any other College and there were no circumstances in which the default of one could cross-default another. By aggregating their debt requirements, the individual Colleges were able to access a source of long-dated, cheap finance which would otherwise not have been available to them as small issuers.