LendInvest plc (LSE: LINV), a top UK-based property finance platform, has sold a £100 million buy to let portfolio to JP Morgan.
In January 2021 LendInvest completed the creation of a Separate Account Mandate with JP Morgan with a total capacity of £625 million. This provided JP Morgan with exposure to buy-to-let mortgages which have been originated via LendInvest’s proprietary technology platform. This sell transfers £100 million of previously originated buy to let loans into that Separate Account, growing its capacity from £625 million to £725 million.
According to LendInvest, the portfolio sale will boost net profit before tax for the year by £1.6 million. Additionally, the portfolio will sit within JP Morgan’s Separate Account Mandate. LendInvest states that the sale is representative of the interest by global institutions to invest in mortgages originated on its platform. It follows LendInvest’s announcement in August 2021 of a £150 million partnership with Barclays and HSBC to provide short-term finance to property entrepreneurs around the UK.
LendInvest said the sale was in line with its strategy of transferring assets under management originated on their platform to third party investors which will enable funding of future transactions.
LendInvest said the Board of Directors remains confident with current market expectations for FY23 and beyond.
Rod Lockhart, Chief Executive of LendInvest, commented on the transaction:
“I am very pleased to be able to announce this transaction so soon after our IPO. The sale is an opportunity to deepen our Separate Account with J.P. Morgan, made possible by strong market conditions and good performance in our Buy-to-Let portfolio over recent months. It is representative of our continued momentum in attracting some of the world’s most sophisticated investors. Genesys, our proprietary technology platform, and broker-focused model allows LendInvest to efficiently originate property finance loans, providing partners with access to an asset class with attractive risk-adjusted returns. This transaction reflects our intentions at IPO to move more assets off our balance sheet over time, seek to take these profitable opportunities when they present themselves, and strengthen our funds management business model.”