LENDINVEST is launching a five-year retail bond, to attract more funding from a broader range of investors.
The specialist mortgage lender closed its online platform to retail investors in May, so the new notes will open up its property investment opportunities to individuals again.
The sterling-denominated fixed-rate notes offer 5.25 per cent annual interest, payable twice a year. The facility was issued by LendInvest’s wholly-owned subsidiary LendInvest Secured Income, which is listed on the London Stock Exchange.
AJ Bell Securities, Equiniti Financial Services and Redmayne-Bentley are authorised to offer the bonds to their customers, with a minimum subscription of £2,000.
The offer period is expected to close at noon on 4 August.
“As we continue to scale the business, we’re increasingly looking to diversify our funding model and expand our capacity to lend to underserved borrowers, as well as to create new entry points to an attractive asset class that suits a broader range of investors seeking competitive risk-adjusted returns,” said Christian Faes (pictured), co-founder and chief executive of LendInvest.
“The launch of this bond allows us to achieve both of these ambitions, supporting future growth goals.”
Read more: LendInvest launches alternative to BTL loans
Rod Lockhart, managing director of LendInvest Capital, added that the bond is launching at a “critical time” for the UK’s residential property sector.
“The retrenchment of traditional lenders from short-term or small-scale property financing has created a fundamental lack of capital for professional property investors, but also an opportunity for competitive alternative lenders like LendInvest,” he said.
“We want to support more professional borrowers through our tried and tested model and excellent track record and the retail bond creates a whole new funding source which enables us to do so.”
Peel Hunt is acting as lead manager on the transaction.
As Peer2Peer Finance News reported last month, LendInvest has cancelled its application with the Financial Conduct Authority to operate a peer-to-peer lending platform. However, it is thought that the company will remain a member of the Peer-to-Peer Finance Association.