Peer-to-Peer commercial property lender Relendex is going after a third round of funding and they are crowdfunding now on Angels Den. Relendex has already raised £1.6 Million in equity and management is looking to raise another £150,000. The Relendex team states they have built their platform and put the infrastructure in place for a fraction of costs compared to many other P2P platforms that have spent tens of millions.
“Our business is in the right place at the right time, banks aren’t efficient and they don’t have as much money to spend as they did before the crash,” said co-founder and CEO Michael Lynn. “Our crowdfunding platform, for commercial property lending, is a way of by-passing the banks.”
Relendex connects each borrower with many lenders who each may provide a portion of a loan. Investors get better interest on their savings as lenders and borrowers get their loans faster at competitive rates. The platform has already completed its first loan of £700,000 which was oversubscribed and has recently posted a new loan of £1.4 million. The company will bring to borrowers alternative sources of capital while providing lenders with secured returns of 5% to 10% per year for periods of up to 5 years. Their focus will be on loans of £200K to £2m initially and later in the range of £2m to £20m.
The founders of Relendex first want to become accepted as the alternative method of funding commercial property and then they intend on expanding in both the UK and overseas markets.
“Our three year projection shows a return on investment of 5.7 times and an IRR of 87%.
“The size of the market and the opportunity to place more larger ticket loans, means that this platform has the ability to grow into a £100 million+ business very quickly with a £500 million loan book within less than three years.
“We will seek a listing on the AIM market once new business momentum and scale justifies it – the foreseeable target valuation is a £100m+ capitalisation.”
The equity investment raised on Angels Den is for the development and expansion of the business, including recruitment of key personnel and targeted marketing. While already built and tested, the platform will also benefit from the increased investment with new functionality planned to increase turnover and profitability.
According to Relendex, there is currently £285bn of loans outstanding against UK commercial property and large residential schemes, held predominantly with UK lenders and building societies, as well as international lenders dominated by German and North American banks. Of that more than £150 billion is due for refinancing by 2016, but of the 74 lending institutions surveyed by De Montfort University, 28 indicated that they weren’t open for new business in 2012. This includes a number of high profile organizations such as SocGen, Eurohypo and Clydesdale.
“Relendex is a fantastic opportunity with some no-nonsense founders behind it. It’s great to see that they’re in talks with a number of our angel investors already. Ignore this one at your own peril.”
Relendex was co-founded by CEO Michael Lynn who was previously a Chartered Accountant with Deloitte and an investment banking background with Charterhouse group (now part of HSBC) and Director Sam Rosen who is Founder of Burford Group plc a successful listed property company.
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