The fund’s objective is to work with existing development finance providers and borrowers to undertake the following core activities:
- Acquire existing portfolios of loans
- Provide cost to complete facilities
- Refinance existing loans
The fund is backed by long-dated institutional capital and will focus on opportunities from £50m-plus (or with the potential of achieving £50m in aggregate through a series of loans).
Maslow said it was seeing funding requirements in the following areas: closed-ended funds, open-ended funds, and other structures.
In all these cases, the lender stated it had solutions that can provide liquidity, allowing a return of funds to investors, while also alleviating cash flow pressures arising from lenders being contractually bound to fully fund live developments through to completion.
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“While we will continue to originate and finance the delivery of ground-up developments, the launch of the Maslow Liquidity Fund will help broaden the range of transactions we can support,” commented Ellis Sher, CEO and co-founder of Maslow Capital (pictured above).
“The pandemic has caused companies to relook at their business models, and our view is that, in our development funding niche, existing lenders and borrowers will be seeking alternative ways of de-risking and generating liquidity, while protecting asset values by ensuring developments reach practical completion.
“The core objectives of our debut liquidity fund is to do precisely that.”
Maslow — which was founded in 2009 — noted that its first fund focused on partnering with banks where it provided the financing to ensure developments reached practical completion.
Maslow’s facilities protected the lenders’ exposures by enabling the properties to be completed and brought to market without being distressed or significantly discounted.
Over the past decade, Maslow has seen the emergence of many new specialist lenders, each which have their own unique funding sources, while banks have focused on the provision of more traditional credit.
The development lender believes that the current climate will present these funding models with their biggest ever test.