Sun shines for new crowdfund offer

Written by Lisa Stanley Mann on 19th August 2016

New asset-based crowdfund platform Downing Crowd has launched its sixth crowdfunded bond.

Downing is looking to raise £3.3m via the Woodbridge Solar bond. The bond will pay 5 per cent over the one year term – which includes a 0.5 per cent early bird bonus until 31 August 2016, after which the bond will offer a 4.75 per cent return over one year for investments made between 1 and 21 September, falling to 4.50 per cent over one year for investments made thereafter.

FCA authorised intermediaries will qualify for a 0.25 per cent annual commission.

Woodbridge is an operational 9MW solar farm sited at Hanson’s cement works at Ketton, Rutland. It was named the best ground-mounted solar farm in the less than 10MW category in the 2014 Solar Power Portal Awards. 

The solar farm converts solar energy into electricity and sells the electricity produced. It also receives government subsidies by way of Renewable Obligation Certificates (ROCs). It was developed by Armstrong Energy, which has supported £185 million worth of solar projects across the UK and with whom Downing has worked on more than £90m of solar projects over the last five years.

Other offers currently available on the Downing Crowd platform are York Green (5.5%), an onshore windfarm, and Downoak (5.75%), a chain of country pubs in the home counties. Each offer is an investment bond issued by an individual company which allows prospective investors to select offers that are most suitable to them. Downing only considers bonds issued by companies with existing operational assets and established revenue streams.

Julia Groves, head of crowdfunding at Downing says, ‘A common theme in the feedback provided by our investors is that they like the sustainability and ethical approach to investing in projects that are geared to helping the energy crisis. We are essentially offering potentially attractive risk adjusted returns for investors and competitive finance for growing companies.’

Downing has been investing in real businesses for more than 20 years, traditionally through tax-efficient vehicles such as VCTs or EIS. Many of these businesses have matured and the rules around tax have changed so that some are no longer eligible for that tax incentive. The companies issuing bonds such as Woodbridge Solar are already known to Downing and each investment is secured against the operational assets of the business, typically with a loan to value of under 45%. Downing says it applies the same level of due diligence to crowdfunded offers that it does in its investment management business.

Those considering other renewable energy investment opportunities could look at Abundance, which has a forthcoming opportunity to invest in Debenture for a Scottish wind turbine site, or Ethex, which is currently offering the chance to buy community shares in BHESCo, a not-for-profit social enterprise bringing together the community of Brighton and Hove to develop renewable energy projects, improve energy efficiency, reduce fuel bills and tackle fuel poverty.