The first fully-digital private bond has been launched to finance affordable housing in England, using blockchain technology.
Lares Digital Bonds will be used to fund up to 2,000 affordable housing projects in the Midlands and Northern England, worth up to £15m in total.
The bonds are backed by Black Manta Capital Partners and have been issued via IDAP Alternative Investments’ securitization platform. The private placement solution was enabled by software company Globacap using blockchain technology.
The bonds will have a term time of 3.5 years, and offer a seven per cent fixed annual yield to investors. They are available to both retail and institutional investors, with a minimum initial investment of £10,000.
“We are proud to be part of this project, as it is fully aligned with our vision of digitized assets,” said Alexander Rapatz, co-founder and managing partner of Black Manta Capital Partners.
“Black Manta Capital was an early entrant, and we’ve handled everything from tokenization of real estate to equities, to funds. When IDAP brought us the opportunity to bring our tokenization expertise to the project financing space, we knew this was the next step.”
“With our complete, digital ecosystem, processes are automated to significantly reduce admin time and accelerate deal closure,” added Alexander Green, chief evangelist and co-founder of Globacap.
“We’re really proud to see it in action as part of this partnership with IDAP and Black Manta, pushing into the project financing space. We’re taking a significant step towards a fully digitised future and to see it happen this way in private placement is fantastic.”
Legal and traditional financing expertise was provide by Amicorp Luxembourg and CMS Luxembourg, and the bonds are governed by state-of-the-art know-your-customer (KYC) and anti-money laundering (AML) processes.