Merseyside Pension Fund’s Catalyst Fund has made its first investment, with an £11.2m loan to finance Iliad’s development of 120 flats in Liverpool’s Ropewalks.
The loan is the first investment backed by the Catalyst Fund since its inception in 2016 and meets the Fund criteria of investing in projects that will help to deliver economic growth to the Liverpool City Region.
The borrower, the Iliad Limited, is a local developer that has developed numerous projects across Liverpool and has been heavily involved in the regeneration of the city centre over the last twenty years.
The development, to be named The Eight Building, will see a mixture of build to rent apartments interspersed with mainstream build for sale units. It will be adjacent to the first phase of development called St. Michael’s Phase 1, a 260 unit student housing project delivered by Iliad in 2013. It is one of the last sites to come forward in the Rope Walks area of Liverpool which has undergone a dramatic transformation over the last ten years.
Councillor Paul Doughty, chair of Merseyside Pension Fund (MPF), commented: “We are pleased to have made our first Catalyst Fund property investment. As the Fund is the Local Government Pension Scheme for the Liverpool City Region (LCR) it is rewarding that we are able to provide our members with a commercial return whilst stimulating economic growth in the LCR. We look forward to the potential of making similar investments in the future.”
Chris Shorrock of CBRE Capital Advisors, MPF’s retained property investment advisor, commented: “We are delighted to provide Iliad with this debt facility, on behalf of the MPF’s “Catalyst Fund”. This investment represents what the Fund was set up to support, economic growth in line with the LCR’s strategy. Additionally we are pleased to support a local developer with significant development experience in Merseyside. Part of our strategy for the Fund over the past 18 months has been to invest in development finance in the regions as it is scarce and the traditional clearing banks remain averse to funding outside of core areas such as London or without significant pre-sales agreed. There are therefore good opportunities for alternative funders to step in, contributing to the regeneration and future-proofing of the local area.”
Tim Molloy from Iliad commented: “Iliad have been successfully developing in the Ropewalks area for the last 20 years and are now delighted to be working with a local fund to bring forward our latest scheme which will create jobs and much needed family housing in the area.”