CrowdProperty reaffirms commitment to retail investors
CrowdProperty has underlined its commitment to individual investors in the wake of Assetz Capital’s withdrawal from the retail market earlier this month.
The peer-to-peer development lender, and its mezzanine finance arm CP Capital, said that platform investors are “central to our long-term business strategy”.
“Marketplace lending as a sector was revolutionary in bringing lending opportunities direct to individuals, more efficiently and effectively matching the supply and demand of capital for the benefit of all,” CrowdProperty said.
Read more: Assetz chief expresses regret at retail exit
CrowdProperty said it has seen “exceptional demand” from investors and is expanding the number of lending opportunities on both CrowdProperty and CP Capital, enabling stronger diversification potential.
“On average, platform investors are invested in 85 loan parts across 55 facilities (excluding investors in just one loan and those starting to lend in the last 180 days),” the firm said.
CrowdProperty has also secured a number of institutional funding lines in recent years, including a £300m deal agreed in July 2021. But it highlighted the benefits of diverse sources of capital.
“Institutional capital sources look to work with the very best, proven, high quality lenders with strategic
advantage built into their business models and undertake many months of due diligence before
committing,” CrowdProperty said.
“Our very purposeful strategy of diverse sources of capital (across both platform investors and
major financial institutions) provides reliability of capital to property developers, which is
important to them. This, and other distinct elements of our developer-side proposition, means
that we attract more and more developers wishing to be funded by CrowdProperty, bringing
more opportunities to invest to our platforms.”
Assetz Capital announced last week that it will run off its retail investment loan book over the next five years, as it pivots to becoming an institutional-only platform.
The platform said that the decision was made following the rapid rise in the base rate and corresponding increases in bank savings rates.
Assetz Capital had been offering returns of approximately four per cent via its easy-access auto-investment accounts. The platform increased the rates on its access accounts earlier this year in response to rising interest rates.
However, at the end of November Assetz opted to restrict withdrawals from these retail accounts, citing a lack of new investment.
Read more: CrowdProperty pledges not to increase borrower rates