Canary Wharf

LendInvest partners with pension fund to finance £12m development loan

LendInvest has teamed up with Merseyside Pension Fund (MPF) to finance a £12m loan secured against a development site in Canary Wharf.

The property loan was originated and underwritten by LendInvest and syndicated with MPF.

The pair will be equal partners in the deal with LendInvest acting as security trustee and loan servicer. 

Advised by CBRE Capital Advisors, the pension fund has identified property debt as providing strong relative returns. 

The loan will allow a property development company to finance the purchase of a site in London’s Docklands as the borrower looks to secure planning permission to build a 320-bedroom budget hotel and 199 residential units with a decision expected during 2017.

Rod Lockhart, managing director of LendInvest Capital 

“We are delighted to be working with major public sector institutions like MPF, which is something that we have built LendInvest to do successfully,” said Rod Lockhart, managing director of LendInvest Capital.

“Returns from short-term property debt are increasingly attractive to investors in this low interest rate environment.  

“We look forward to making co-investments with MPF and other UK pension funds as a regular component of our funding mix.”

Chris Shorrock of CBRE Capital Advisors said that at the current time it believed that investing into the property debt space provided attractive returns compared to direct equity property investments.

“Having an allocation for debt funding in the property portfolio should assist us in outperforming the fund’s IPD {Investment Property Databank} benchmark. 

“We are pleased to have undertaken our first debt syndication with LendInvest and it demonstrates that alternative lenders and institutional investors can team up to achieve attractive returns for their investors.”

The deal is one of LendInvest’s largest loans to date as it looks to begin a strategy of providing larger loans to established borrowers investing in and developing property around the UK.

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