Introduced at the start of the month, our latest residential property development investment opportunity - Carlton SPV1 Chilton Limited - has just reached 76% funded. This opportunity is set to end in the next few weeks, closing the round at a figure of £400,000.
We have recently been talking in detail about how you can benefit from including property in your portfolio, beginning with our guide to integrating property into your portfolio. Residential property investment has always been a popular asset class, with buy to let being the dominant approach. However, as we've discussed, this is changing and this opportunity provides a great example of how a different investment structure can bring a new range of potential benefits.
As a special purpose vehicle, Carlton SPV 1 Chilton Limited ('SPV1') will be set up for the development and sale of 14 luxury family homes in Chilton, County Durham. This means that as well as providing much needed quality housing in an area of high demand, investors can benefit from the advantages provided by investing through an SPV.
What are the advantages of investing into the Chilton investment opportunity?
The investment opportunity at Chilton is set to develop much needed homes; homes that are attractive and perfectly suited for young families and professionals alike.
Whilst the building of homes to help tackle the country's housing crisis can undoubtedly be an attractive proposition for investors alone, there are a number of key advantages of investing into the opportunity.
Investing for growth
By investing into an SPV, benefits are realised primarily as growth rather than income, with the return on investment deilvered from the profits made on the development after all fees are paid according to the equity share held. This means that you have the opportunity to realise a capital return, which normally requires holding an asset for years, in a much shorter time frame, whilst also having the returns taxed as a capital gain rather than income.
Asset backed SPV structure
As an equity investor in the SPV (which owns the assets), you have the reassurance that you own a share of the underlying asset of the development. This means that whilst the investment is asset backed, providing security in the form of the property owned, there is no higher rate of stamp duty to be paid by investors.
Demand for homes in the area
Based in County Durham in the North East, Chilton benefits from good local amenities and close proximity to both the city of Durham and the market town of Darlington.
With positive demand in the area recently, the trend is expected to continue throughout 2018 and beyond as there is a distinct requirement for starter and small family homes. This has prompted a significant amount of investment in the area, aiding in the supply of quality housing to satisfy the growing demand.
1.5x target money multiple returns
The site will be acquired with the benefit of detailed planning consent and with house prices ranging from £160,000 to £215,000. This drives a target base case return of 1.5x multiple of money, meaning a £10,000 investment would be targeting a £15,000 return.
The investment raise to date
Investors have the opportunity to co-invest alongside Fusion21, a corporate investor and JV partner of CoreHaus and nine other sophisticated investors to fill the remaining tranche of this capital raise.
The company has already raised over £300,000 and has reached 76% of the £400,000 funding target with under £100,000 remaining for further investment.
How can you pledge your interest in Chilton?
If you're interested in this offer you can view the full opportunity on the Carlton SPV1 Chilton online pitch. There is only a limited allocation of the offer remaining, so reserve your allocation now - and if you have any questions, please do get in touch.