Pocket, a new type of property developer, is seeking a raise of £1.5 million on Crowdcube offering investors the ability to earn 7.5% gross interest rate starting at £500. The “Pocket Bond” is set for a 4 year term at which time investors may choose to receive cash for their principle or hold the bond for another year at the same terms. The new funding will support a plan to build over 4000 starter homes around London over the next ten years. Pocket has received a loan in the amount of £21.7 million from the Mayor of London, Boris Johnson – along with the support of the Lloyd’s Banking group. Pocket was founded by Marc Vlessing and Paul Harbard.
Pocket sells affordable homes for moderate-income ‘city makers’ in London. Pocket’s business model is to build affordable starter homes, without public subsidy, sold outright to buyers at a discount to the local market of at least 20%. Pocket works closely with local councils to develop smaller infill sites on brownfield land where a market developer would normally not provide much affordable housing. All Pocket buyers are described as singles and couples with a current average household income of around £40,000.
“Last year was a great year for Pocket, we are rapidly expanding to meet a strong demand for affordable housing among London’s city makers. This Bond is an exciting opportunity to support an alternative to London’s middle-market housing crisis and invest in a scheme that offers a return on your capital,” said Pocket Co-founder and CEO Vlessing.
Pocket explains they have an award-winning design for their apartments that leverages the best possible use of space built with high quality but not extravagant materials. Pocket buyers own 100% of their home and is said to differ from more complicated shared equity schemes.
Pocket follows in the footsteps of other successful Mini-Bond offers on Crowdcube. Chilango and its “Burrito Bond” was followed by offerings from River Cottage, Eden Project and Taylor Street Baristas.
Co-founder of Crowdcube, Luke Lang, said of the offer, “The mini-bond revolution continues to disrupt the investment market and we’re excited to add a property developer that is so innovative, providing well-designed, affordable local housing for people who work in London.”
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