This latest round includes a £50m investment from the Scottish National Investment Bank (SNIB), with the rest coming from a US public foundation.

In a first for both the fund and Scotland, the investment will introduce an intermediate rent tenure where both rent and energy costs will be discounted by around 20% compared to market renting.

The SNIB’s capital will all be deployed in Scotland and will enable a minimum of £100m to be invested in Scottish developments. The homes will also be offered to key workers on a first priority basis.

Overall, the funding will also unlock over 1,000 ‘Zero Bills’ homes across England and Scotland. The ‘Zero Bills’ scheme launched in 2022 to let customers move into homes designed with green tech — such as solar panels and heat pumps — with no home energy bills for at least five to 10 years.

•   The Finance Professional Show 2024: The Video
•   Octopus funds two care funds with £30m
•   Octopus backs sustainable Essex scheme with £20m

“Our aim for this year was to double the size of our Affordable Housing Fund, and we’re so pleased to welcome our new investors into the Fund, enabling us to close in on our next £500m milestone,” said Jack Burnham, head of affordable housing at Octopus Capital.

“This also marks our first time investing specifically into Scotland and its discounted market rent housing.

“We’re hoping to transform communities there, providing energy-efficient, future-proofed housing to those that need it most.”

Nicola Douglas, executive director of sustainable investments at the SNIB, added: “The Affordable Housing Fund is a brilliant example of the innovative approaches — to both securing capital and ensuring homes are affordable — that we need to deploy at scale.

“Octopus Capital’s approach to sustainable building and discounting both rent and energy takes a holistic approach to addressing cost-of-living pressures.

We are delighted that our investment is helping unlock a further £50m through the Fund for Scotland.”