Mencap’s housing arm, Golden Lane Housing, has launched a charity bond seeking to raise £10m by the end of April.
Money raised from the bond will be used to buy homes for people with a learning disability, a group who traditionally find it difficult to obtain housing.
Golden Lane Housing (GLH) says it’s the largest unlisted charity bond issued.
Alastair Graham, director of GLH said it was confident it would hit its £10m target by April as soft market testing, funded with a grant from the Big Lottery Fund, has identified demand among social investors such as trusts and charitable foundations. “We have shaped our offer to respond to these organisations who want a high level of security and evidence of social impact.”
Investors in the bond, which has a minimum investment level of £2,000 per investor, will receive a fixed gross yield of 4 per cent per annum for a five-year fixed term.
Graham said GLH was able to achieve a high yield through the regular income stream of rent it will get through its housing scheme for people with learning disabilities.
Investors in the bond will also be able to sell it at a later date on ethical investment trading platform Ethex.
GLH views this bond issue as the first step in raising up to £30m over the next few years, which will mean that in total, investors will give 250 people with a learning disability the chance to live independently in specially adapted homes.
Mencap research finds that 8 in 10 councils in England and Wales report a housing shortage for adults with a learning disability in their areas, with nearly 7 in 10 stating this has worsened in the last 12 months.
Jan Tregelles, acting chief executive of Mencap said: “There is a severe housing shortage for people with a learning disability. Following the abuse scandal at Winterbourne View, demand for housing is set to grow further because the government has committed to return many of the 3,000 people currently in long stay hospitals to their local communities.
“Investors in this bond have the chance to transform the lives of people with a learning disability by helping them to live the lives they choose in quality permanent homes.”
Triodos Bank advised GLH on the bond. Triodos Bank also advised Golden Lane on its first ever bond issue back in 2003, which raised £1.8m.
Graham said GLH also hoped that individuals that invested into its first bond would invest in its new GLH bond.
