Real Estate Investment:Today

Sourced Capital completes funding for Lancashire property development

Sourced Capital today announces the completion of funding for an £856,443 loan to finance the development of four five-bedroom detached houses near Chorley in Lancashire.

The loan has been funded through leading property investment platform, Sourced Capital, and has a term of 15 months with a loan to gross development value of 69 per cent. Investors will receive a targeted return of 10-12 per cent per annum*, with the higher rate applicable to investments of £20,000 and above.

This is the first of two tranches, with a total loan value of £1,496,000 agreed to complete the development. The first tranche will support the purchase (enabling first charge security to be held), with the remaining loan proceeds released periodically as the development progresses satisfactorily. The second tranche will then provide the remaining funds required to complete the development.

The targeted interest rates mentioned above are still available to investors on other loans presented by Sourced Capital to their registered, qualifying investors. Sourced Capital are currently offering investors the chance to back a £5 million loan for a large property development in Taunton, Somerset, which is close to reaching its funding target as demand for peer-to-peer property investments continues to grow.

Derek Pratt, Commercial Director at Sourced Capital, said: “Property investment has long been a popular choice for investors interested in the comfort of tangible asset values. Given the combination of Peer-to-Peer providing the ability to easily diversify exposure across a portfolio of properties and rising inflation causing investors to review their strategies to avoid net value erosion, it is no surprise to see increasing investor interest in the P2P sector. For those investors who were not able to participate on this occasion due to the speed of the loan being fully filled, we have a strong pipeline of further asset-backed property development investment opportunities due to open for investment over the coming weeks.”

Investors have been attracted to these investment opportunities due to Sourced Capital’s targeted rates, evidenced record of repayment to investors, the short-term nature of the property loans (new loans presently range from 6-18 months), and the fact that every loan benefits from security by way of a first legal charge over independently valued UK-based property.

Sourced Capital has returned over £15m to investors since its inception in 2019 and are proud to report a performance, to date, where 100% of all capital and interest due has been repaid to investors on loans that are no longer active. They have funded more than £25m of loans for property developments across the UK and, over the past three years, investors have achieved an average return in excess of 11 per cent per annum. Investors can choose the property projects they wish to invest into.

“We are lending to support a wide range of property transactions including ground-up developments, conversions, and refurbishments. Whilst our sweet spot for lending is typically between £250,000 and £3m, we always assess each proposal on its individual merits, with the current pipeline demonstrating our willingness to support quality transactions both above and below this range if they provide the right calibre of opportunities for our investors,” says Derek.

*Peer-to-peer is not appropriate for all investors, with a risk of capital loss evident even when the loan is secured by a first legal charge. However, for qualifying investors, it is understandable why they would want to investigate how this type of investment might be a part of their balanced portfolio.

Sourced Capital continues to increase funding for viable residential property developments in the UK, and with a specific focus on more sustainable housing. It only funds projects below 70 per cent loan-to-value.

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