Prominent peer Lord Stanley Fink, often described as the “godfather of the hedge fund industry”, has invested £7m in proptech investment platform British Pearl.
The platform claims to be the first to offer debt and equity investments in individual property deals “in one place”.
British Pearl’s model encourages investors to split investments between fractional equity ownership of property and to act as mortgage lenders in their own right. Investors are able to own a shares in a property company managed by the platform, entitling them to a share of rental income from the company owned assets. Or investors can become loan providers themselves paying into a standalone property owning company managed by British Pearl.
For equity investors, there is increased protection since each property is ring-fenced in a standalone holding company, separate from the liabilities of other investments and British Pearl itself.
The company offers property loans at 50-70% loan-to-value. British Pearl’s tax-free interest on UK property loans is currently running at up to 4.4% per year, after all fees.
‘Defying Brexit doom’
Alongside his investment Lord Fink will become a non-executive director of the new platform. Commenting on the investment he said: “Despite the doom-laden predictions that are being mooted because of Brexit, I’m backing British Pearl and UK property for three reasons: first, the country is in desperate need of new homes, which the Government is working hard to provide, so the fundamentals are strong and the property market still presents many attractive opportunities.
“Second, property has been one of the most consistent, profitable and trusted asset classes in recent times; and, third, British Pearl is not only making property investment accessible but giving people two different ways to invest in it through one platform. We know investors don’t always want all their money tied up in property equity investment, so we’re giving them the option to diversify their portfolio into debt within the same platform.”
The platform launched earlier this year with three investments made up of six residential units in Acton, Portsmouth and Lancaster and the company has said it will extend its offering into commercial units “in the coming months”.
Founder of British Pearl, and RESI Trailblazers nominee, Ali Celiker added: “Our goal is to give investors the all-important choice as to how they invest in the properties they select, whether the reduced risk associated with conservative LTV property loans, the greater potential upside of equity stakes or a mixture of both. Ultimately, we’re empowering people to design and diversify their investment portfolios to suit their own specific needs and individual risk profiles.”
Lord Fink, who is worth an estimated £180m, served as chief executive of hedge fund investor Man Group from 2000-2007, building the company up to become the largest listed hedge fund in the world. In 2008, he came out of retirement to act as the chief executive of International Standard Asset Management in partnership with Lord Levy and he was recently named as a special adviser to online trading platform eToro.