Merseyside Pension Fund has made its first investment from the Catalyst Fund, a pot of money which opened for bids in 2016. Advised by CBRE Capital Advisors, the MPF is to finance Iliad’s development of 120 flats in Liverpool’s Ropewalks with an £11.2m loan.
The fund’s criteria is to invest in projects that will help to “deliver economic growth to the city region, upgrading the housing offer, regenerating deprived communities and maximising the use of new spaces in the city”.
The development vehicle Iliad (Grenville Street) Ltd is the borrower for the scheme, which will be branded The Eight Building and will be a mixture of rental apartments and apartments for sale.
The building, designed by Tim Groom Architects, will be next to the first phase of St Michael’s, a 260-unit student accommodation project delivered by Iliad in 2013.
Cllr Paul Doughty, chairman of Merseyside Pension Fund, said: “We are pleased to have made our first Catalyst Fund property investment. As the fund is the local government pension scheme for the Liverpool City Region it is rewarding that we are able to provide our members with a commercial return whilst stimulating economic growth. We look forward to the potential of making similar investments in the future.”
Chris Shorrock of CBRE Capital Advisors, MPF’s retained property investment advisor, added: “This investment represents what the fund was set up to support, economic growth in line with the LCR’s strategy. We are pleased to support a local developer with significant development experience in Merseyside.
“Part of our strategy for the fund over the past 18 months has been to invest in development finance in the regions as it is scarce and the traditional clearing banks remain averse to funding outside of core areas such as London or without significant pre-sales agreed. There are therefore good opportunities for alternative funders to step in, contributing to the regeneration and future-proofing of the local area.”
Iliad finance director Tim Molloy said: “Iliad have been successfully developing in the Ropewalks area for the last 20 years and are now delighted to be working with a local fund to bring forward our latest scheme which will create jobs and much needed family housing in the area.”