CapitalRise, the property crowdfunding platform which launched just last week, has already closed its first deal, raising the full £1m target to help finance a Finchatton development on Eaton Square in just eight working days.
The project – to extend and renovate a 2,400 square foot three-bedroom ground- and lower-ground floor flat in the heart of Belgravia – should be worth £8.15m once completed. This £1m batch of finance comes in as debt, promising investors a 10% annual return over an 18 month timeframe.
Read all about the deal on PrimeResi here.
CapitalRise was founded by luxury property stalwarts Alex Michelin and Andrew Dunn, founders of super-prime developer Finchatton (which has completed over 120 developments worth over £1bn), with Wonga Group’s former Head of Product Uma Raja as CEO. The idea is to offer “institutional grade” real estate investments to everyday investors, with as little as £1,000 to put in. Investors can get returns of between 10% and 18%, while investing alongside some of the most successful major players in the industry; Dunn, Michelin and Rajah will be personally investing in every project listed on their new crowdfunding platform.
The team is now prepping its second project – at N0.18 Grosvenor Square in Mayfair – to go live on the website soon. An apartment at No.18 went for £16.75m (£4,773 per square foot) in May last year.
“We have been amazed at the demand for this offering,” said an email to investors. “We were oversubscribed and now have a waiting list for the next project. As a result, we are trying to fast track the next investment opportunity at 18 Grosvenor Square in Mayfair.”
CEO Uma Rajah, said she was “delighted” at the “extraordinary” take up: “Over the past few days, we have reached our funding goal for the project and are delighted at the interest from investors. We think Brexit has probably helped us. We suspect that the current market conditions such as the volatility of the stock market, low yields from Bonds, the falling pound and concerns about bank interest rates probably increased the attractiveness of our investment which offered a fixed return and was secured by bricks and mortar.”