Archived: Pocket Land Bond: fast growing property developer delivering affordable homes to London’s middle earners iCrowdNewswire - Jan 5, 2016 The Bond The Pocket Land Bond is a very straightforward idea – you loan money to us and we agree to pay you interest quarterly per annum and redeem your initial investment (the ‘principal’) when the Bond(s) mature in 4 years. The Pocket Land Bond will be issued by Pocket Living Ltd. We have designed the Pocket Land Bond to be a simple investment. For an initial investment of £250 or more, Pocket Living Ltd will provide registered holders of Pocket Land Bonds (“Bondholders”) with a fixed-rate return of 7.5% gross interest per annum over the course of an initial four year term payable in cash. At the end of the initial four year term and on every anniversary thereafter, you have a choice: either continue to hold your Pocket Land Bonds for another year on exactly the same terms or give us six months’ notice and we’ll redeem your Pocket Land Bonds. On maturity of the Pocket Land Bonds, the full amount of your initial investment will be repaid without any deductions or charges. Use of Proceeds: Pocket is different to most other private property developers because we deliver affordable housing as our main product, rather than an obligatory sideline through planning. Pocket’s capital structure was greatly enhanced in 2013 by the provision of a £21.7m loan from the Mayor of London, which is for 10 years and which is being used to purchase land for affordable homes. Pocket was subsequently able to secure a £30m loan facility with Lloyds Bank to fund the construction of our homes. This funding structure for land and construction has worked well since 2013 allowing Pocket to grow its pipeline to up to 600 units for the next few years. Since 2013, much has changed. In March 2015, we invited individual investors to take up our first Pocket bond through Crowdcube, with great success. Since then, having enhanced our operations and grown our business, the GLA has increased its loan to £26.4m, all of which is allocated to fund the affordable element of land costs. In addition, the property development landscape has changed, with increases in construction costs and land values. This, combined with the increased interest in Pocket homes, and our enhanced resource, has meant that Pocket has started buying larger sites, which achieve greater economies of scale. Larger schemes also necessitate a broader mix of unit types, including more open market units, which also make schemes more economically viable. Pocket’s core business remains focused on affordable housing, with open market homes making up a small proportion of the product that is provided. The extension of the GLA’s loan to £26.4m earlier this year has helped to fund the growth in the land pipeline to deliver affordable Pocket homes. However, Pocket needs alternative sources of capital to fund its open market homes, as the GLA loan cannot be used to fund the private proportion of land – the additional capital required amounts to less than 5% of the overall funding. In the past, where additional funding for the open market proportion of land has been needed, the business has used alternative funding options on a project by project basis. However, after our success raising funding through Crowdcube earlier this year, we are now looking to crowdfunding. Pocket is launching the Pocket Land Bond through Crowdcube to gain a capital source that can work across a number of upcoming projects, thereby benefiting from a lower cost and quicker funding process. Pocket aims to raise £1.25m through the Pocket Land Bond to cover upcoming projects. If the Pocket Land Bond overfunds and attracts the maximum of £2.5m this will allow funding of the open market element of the expected pipeline of schemes. With the vast bulk of capital supplied by the GLA and Lloyds, Pocket is now looking to ordinary people to further help the housing of ordinary Londoners.