An innovative funding arrangement is helping to accelerate the growth of an award-winning housebuilder and fast-track property ventures around the North East.
MAVEN Bonds is providing short-term finance to County Durham developer Homes by Carlton, to drive forward several property schemes around the region.
The Newton Aycliffe-headquartered firm recently used a £300,000 short term development finance loan to fast-track construction work on its Cathedral Gates development in Chilton.
Situated eight miles from Durham City centre, the scheme comprises 14 spacious plots with a mix of three and four-bed detached and semi-detached homes. It has proved popular with ten of the plots already sold – giving the construction team the confidence to accelerate the building programme.
MAVEN Bonds has been designed to provide investors with the opportunity to diversify their investment portfolio by providing loans to property development projects that offer the potential to generate higher tax-free returns compared to mainstream investment options.
Simon Lenney, independent chairman of MAVEN Bonds, said: MAVEN Bonds focuses on two main areas; firstly to provide investors with the opportunity to invest into well structured property projects.
Secondly, to provide experienced developers and real estate professionals such as Homes By Carlton with access to loans of between £200,000 and £2million.
Having completed this first short term development loan, MAVEN Bonds has provided a separate £800,000 bridging loan to allow Homes by Carlton to acquire land for new homes site at Thorpe Thewles, in Stockton-on-Tees.
The developer is aiming to get building underway soon at the Thorpe Paddocks, a residential scheme that will see 31 luxury family homes built at Thorpe Thewles.
Simon Walker, managing director of Homes By Carlton, said: “I’m really pleased that we’ve managed to secure bridging and development finance with MAVEN Bonds. After we quickly sold the first ten homes at Cathedral Gates, we wanted to speed up the construction process on site and the loan enabled us to do that.
“Working with MAVEN Bonds was a pleasure; having secured the loan rapidly, we’ve been able to start construction work sooner than anticipated and we also have additional finance in place to move quickly on our Thorpe Thewles development.”
Simon Lenney, independent chairman of MAVEN Bonds, said: “I’m delighted to see how the loan has enabled Homes by Carlton to press ahead on the Chilton scheme and then acquire an exciting scheme at Thorpe Thewles. This is exactly what MAVEN Bonds was set up to do – to provide quick, alternative finance that can speed up property developments and provide our investors with the potential to earn much higher returns than those currently available through traditional investment routes.”
MAVEN Bonds is a joint venture between private equity firm MAVEN Capital Partners and Growth Capital Ventures (GCV). It has been driven by rising demand for good quality housing and is a response to the lack of fast, flexible mainstream finance available to property developers and investors in many sectors such as hotels, student accommodation and residential.
The bond works by providing secured loans to property developers and property development companies. Returns are generated by charging interest and fees on these loans. Both MAVEN and GCV have a strong property track record and since January 2015, the combined MAVEN and GCV advisory team have completed property transactions worth more than £300 million, leveraging over £125 million of equity in the process.
The MAVEN Bonds Investment Platform - www.mavenbonds.co.uk - has been created and developed by GCV’s inhouse software engineering team. The online investment platform has been designed to streamline the investment process and provide experienced investors with access to bonds with higher target returns than that of more mainstream investment options.
Photo caption: Norman Peterson, GCV CEO; Simon Walker, Homes By Carlton managing director; Simon Lenney, independent chairman of MAVEN Bonds; Craig Peterson, GCV operating officer; Michael Marram, Homes By Carlton, senior site manager
"Having secured the loan rapidly, weve been able to start construction work sooner than anticipated. "
Simon Walker, MD, Homes By Carlton