If the TOWIE tans are anything to go by, Colchester is a great spot for a bit of sun.
So just as well that the latest Crowd Bond from Downing Crowd – a fundraise of £2.7 million for Alternate Energies, is in Colchester.
Crowdfunding has generally been associated with high risk equity investment, however investment specialist Downing is challenging that perception by offering asset-backed bonds.
It seeks to manage risk for bondholders by lending only to companies with existing operational assets.
The platform has raised over £14 million in funding in just over six months, predominantly lending against renewable energy.
Julia Groves, head of crowdfunding at Downing, said: “We have been investing in renewable energy projects since 2010 and believe that these Crowd Bonds offer attractive risk-adjusted returns for investors and provide competitive finance for growing UK businesses focussed on developing clean technology.
“The appeal for people to invest their money in environmentally-friendly ventures is also increasing. Feedback from a survey conducted among Downing Crowd investors revealed that while respondents primary concern was the level of return offered, almost a quarter of those surveyed cited the attraction of improving alternative energy sources as the main driver behind their investment.”
Alternate Energies is a portfolio of photovoltaic (PV) systems on residential housing in Colchester.
Groves said: “Our relationship with Alternate Energies (AE) began in 2011 when Downing managed funds invested in AE to develop a portfolio of over 300 PV roof-mounted solar panels on social housing owned by Colchester Borough Council, with the capacity to generate approximately 1,000 kWh of electricity. This represents a significant benefit to tenants by reducing their annual electricity costs by around £200 per year.”
The project has a consistent record of performance and this bond represents an opportunity for early investors to earn a return of 5.25% ** over a 12 month period, an attractive risk-adjusted return in the current low interest rate environment.
**5.25% p.a. (includes early bird bonus) for applications received by 5pm on 14 October 2016
4.75% p.a. for applications received from 5pm on 14 October 2016 onwards.