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Peer-to-Peer Lender Initiative Ireland Builds €150m Debt Fund for Housing

Initiative Ireland CEO Padraig W. Rushe intends the launch a new senior debt fund, valued at €150m / £132m, aimed at financing residential property developments.

The new Irish housing fund is scheduled to be launched within three months and will be used as a small builder lending resource to build over 2,500 new family homes across the country over the next five years.

The scheme has targeted an annual investment return of 7 to 7.5% and has already obtained substantial financial backing from Abbey International Finance, which will invest up to €20m, or  £17m.

The Davy Group is expected to provide the fund with investment management and regulatory services while Initiative Ireland will support it with both loan management and investment advisory services.

Initiative Ireland will also use its syndicated finance platform to allow the fund to lend along with its current corporate and private clients.

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The financial technology platform already has a loan pipeline in excess of  €150m, consisting of over 30 housing developments across the country.

It is expected that the small builder lending fund will use special purpose vehicles to supply finances to developers for terms lasting up to two years. The money will be re-deployed over the fund’s lifetime to creditworthy projects.

Mr. Rushe said that his firm will be marketing the opportunity to family offices, large institutional investors, and pension fund managers across both Ireland and Europe. He explained that it will also be available to qualify Irish investors, subject to a regulatory minimum investment.

The fund is expected to obtain greater diversification across the property finance sector. All loans with be backed by assets and secured with a first legal charge against the properties in question.

Calling the approach “innovative but conservative,” Mr. Rushe said that Initiative Ireland has a paradoxical conservatism that makes it stand out from both mainstream finance and other financial tech firms.

Specialists in Construction Insurance

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