LMSL Group, which owns 160 rental properties in east London worth around £52m, said it aims to raise at least £9m to plough back into the ongoing regeneration of the Barking area.
The five year mini-bond will offer investors 10 per cent (gross) interest per annum, secured against the Barking Magistrates’ Court, a new residential development with 37 flats valued at around £10.25m.
Under the terms of the offer, investors have to pitch in at least £1,000 on CrowdBnk, with interest paid monthly in cash.
LMSL founder and chief executive Lahrie Mohamed said: “We are delighted to offer this mini-bond to investors keen to participate in the ongoing expansion of some of the most attractive areas of London’s booming property market.”
“As a business which has spent 20 years investing in property across London, we believe strongly in the attractiveness of the asset class and its ability to generate attractive returns for investors over the long-term.”
It is the first time the company has used a crowdfunding platform to raise money via a mini-bond. “We hope to help investors who may otherwise be unable to benefit from rising London property prices,” Mohamed said.
There has been a deluge of companies using crowdfunding as alternative means of tapping into the UK real estate sector, including Property Partner, The House Crowd, Property Moose and Property Seed. Property Crowd recently raised £1m to buy a luxury flat in one of Berkeley Group’s west London schemes.