A former office block in Taunton is set to be transformed into 55 new flats after a property investment firm secured more than £5m for the development.
Warrington-based Sourced Capital launched a funding round in May to transform number 1 Tangier Central in the Somerset town, after securing planning permission for the site.
The business, which is the the fintech funding arm of Sourced Group and finances projects undertaken by its holding company’s network of property developers, said the latest loan was the largest it had closed to date.
The building will now be converted into self-contained residential apartments, with the contractors expecting all 55 to be ready for occupancy within 10 to 12 months of starting the scheme.
The loan will be used to buy and develop the building and has a term of 18 months to accommodate the development and sales periods, with a loan-to-gross development value of 67%. The targeted interest rate return for investors is 12% a year for investments over £20,000.
The funding for the Tangier Central project was raised through Sourced Capital's peer-to-peer platform, which recently received direct authorisation from the Financial Conduct Authority (FCA). The business said it had seen “huge demand” from investors in two recent loan opportunities launched via its platform, including a £2.1m loan funded in just 24 hours and a £267,000 loan funded in less than 60 seconds.
Derek Pratt, commercial director at Sourced Capital, said: “We are delighted to announce the closing of our most recent investment opportunity, which provided more qualified investors than ever the opportunity to invest in an increasingly popular asset class.
"Over recent months, demand for this type of investment has been growing steadily to the point where we have funded deals in under a minute. This loan helped to satisfy that demand from our investors looking for rates of return that can stay ahead of targeted inflation rates.”
Sourced Capital said it had returned more than £16m of capital and around £2.68m of interest to investors since its inception in 2019. With the Taunton deal, the business said it had now funded more than £32m of loans for property developments across the UK.
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