CapitalStackers has entered into its first ever funding partnership with Shawbrook Bank to finance a luxury apartment complex in Surrey.
The peer-to-peer property development lending platform, which typically focuses on the North of England, raised £950,000 from investors in four days for the project in Furze Hill in Kingswood, Surrey.
The borrower took a personal guarantee for the whole of this loan and Shawbrook Bank provided the senior debt of £8.01m to fund the remainder of the land value and 100 per cent of the construction costs.
With a total debt of £8.97m, the completed scheme was valued at £12.33m.
The project is valued at £529 per square foot with a gross rental value of £508,800 per annum for 14 two-bedroom apartments with 28 covered car spaces.
With the additional funding from Shawbrook Bank, CapitalStackers met its criteria that schemes should be fully funded to completion before any of its investors part with any cash.
“Such a condition may have seemed over-cautious to its competitors pre-Covid-19, but has proved its value in recent months as other platforms have run out of investors midway through construction,” the platform said in a blog on its website.
CapitalStackers investors were offered a choice of three risk/reward layers so could earn from 10.19 per cent at 68.3 per cent loan-to-value (LTV) or up to 14.36 per cent at 74.6 per cent LTV.
“Risk assessments complete, the legal due diligence was expeditiously completed in two weeks to meet the borrower’s site acquisition completion date and strong working relationships developed between the senior lender, broker and borrower which helped the lawyers to make this happen,” the platform said.
“This deal highlights yet again that even in straitened times, the CapitalStackers model provides valuable opportunities for sound borrowers and investors looking for prudent, high-value returns.”