Friday, 1 August 2014
Last updated 1 hour ago
May 5 2011 | 9:16am ET
London-based Paxton Private Finance, a privately funded principal lender, has launched the Paxton Secured Income fund with an oversubscribed first round of investment.
Paxton says the bridging fund has been devised to “capitalize on the banking sector’s current lack of appetite for property lending and to enable investors to participate in the relatively high returns available from providing equity to the short‐term finance market.”
Loans will be provided to a maximum 75% LTV ratio for up to six months, giving property developers and other experienced borrowers scope to move quickly on short-term opportunities while controlling the fund's exposure to market movements.
FSA-regulated operators Real Estate Associates Ltd have structured the scheme as an English limited partnership, enabling the quarterly income distributions to be made gross of tax. An exempt unit trust serves as a feeder for SIPPs and other tax-exempt entities to access the fund in units from £25,000.
Nick McLean, a Paxton partner, said: “As the demand for short-term finance has increased, so too has the need to diversify our funding sources, and we are delighted that the launch of the Paxton Secured Income Fund will provide a broadening of our funding base.”