British Pearl completes sale of property portfolio and repays lenders
British Pearl has successfully sold its whole property portfolio and repaid its lenders the next day.
The property investment platform was launched in 2018, backed by former Conservative Party treasurer Lord Stanley Fink, and lets investors fund property developments through either a loan or equity.
In a shareholder update shared on Seedrs, British Pearl said that the platform completed the sale of its entire property portfolio by close of business on 31 March and investor funds were distributed the next day into their online wallets.
The update said that investors solely holding loans in their portfolio did well, receiving their original principal loan amount back plus all the promised interest payments which paid on average 4.09 per cent, as there were no defaults or missed interest payments in the loan portfolio.
The announcement revealed that investors solely holding shares on average incurred losses of around 10 per cent when including dividend payments and incentives, while lenders who had a balanced portfolio often came out flat or in profit, but this would be dependent on the specifics of their portfolio configuration.
British Pearl said that the decision to sell the portfolio was due to the economic backdrop of Covid and Brexit and hinted that what happened to some other larger property investment platforms this year provided confidence that this was the right choice.
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“Clearly our goal is for all our investors to make money,” the update said.
“However, considering the backdrop of Covid and Brexit, we believe our decision to sell was appropriate at the time and we are satisfied with the outcome; i.e. our investors had access to their cash during a difficult period and we focused on working hard to mitigate the downside risk during a period of great uncertainty.
“My confidence in our decision to sell the portfolio was further reinforced when considering what happened to some of the larger property investment platforms this year; The House Crowd went into administration, BrickLane and Octopus Choice permanently closed for new investment, and Property Partner was sold to American firm Better.
“Clearly there have been some challenges in our market, however I still believe in the accessibility and customer benefits created by property investment platforms and fintech in general. I am pleased that there are still many active UK platforms and many more platforms emerging globally.”
British Pearl said that it is working on making investments available where the local authority will be the contracted tenant and is continuing to speak to companies in the UK and abroad about offering the British Pearl investment platform as a service.
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“Moving forward, we are currently focusing on pursuing two opportunities,” the update said.
“Firstly, we are working on making investments available where the local authority will be the contracted tenant. Under this arrangement rental income risk will be significantly reduced.
“We believe this type of opportunity is more suitable considering the current economic climate. Secondly, we continue to speak to companies in the UK and abroad about offering the British Pearl investment platform as a service (PaaS), in the past we have had significant interest in this area which we are now revisiting.
“Unfortunately, these opportunities are taking longer to pursue than originally anticipated however given the current economic environment we are taking our time and treading carefully.”