HAB Land, part of HAB Housing, has launched an 8% gross AER (based over 5 years) mini-bond, its second venture in crowd-funding. A pre-launch phase to existing investors and partners secured over £600,000, with a £3 million ceiling for the fund. Entry level for investors is £1,000, with a minimum 2-year term.
HAB is working with CODE Investing to provide the crowd-funding mini-bond, an alternative approach to equity funding that reflects its alternative approach to housing supply. The fund will help HAB Land acquire land and site opportunities for future custom build projects, in line with its ethos of challenging the volume building market.
“As stakeholders in a triple-bottom line [financial, social and environmental] business, our investors will be able to see potential returns through social and environmental means as well as gaining a good financial return. We’re a team of dedicated, passionate professionals, building innovative housing schemes and changing the way the UK approaches house building. We don’t just build homes; we make streets and neighbourhoods – proper places,” said HAB Chairman, Kevin McCloud.
HAB’s first crowd-funding venture in 2013 attracted over £1.9m equity for HAB Housing, from 649 investors.
Crowd-funding is an interesting approach to funding, that works well with businesses that have a cachet of being more than a corporate machine, giving something back or building better communities, hence why so many cohousing groups use it as a route to finance.