York-based Grosvenor ‘pension to peer’ fund provides £1.2m support for London office schemes

York-based specialist IFA Grosvenor Financial Consultant will fund £1.2m for the Leeds and London based Prospect Property Group’s (PPG) growing subsidiary, Prospect Business Centres (PBC)’s premium serviced office centres across London and Yorkshire.

Since 2011, PBC has launched three London office centres in addition to its first two in Leeds, creating desk space for over 1,220 people across a total of 80,000 sq ft of fully refurbished city centre space.

Occupancy rates across all five centres is over 90%, and the business is planning to open two further centres in the capital in the next year to meet growing demand and rising rents in London’s high-end serviced office market.

Mark Pepper, founder of Grosvenor, established the commercial lending fund backed by his clients’ pensions in 2009, after working with HMRC and pension law experts. His pension-to-peer lending platform enables private and company pension pots to be lent commercially against secured investments, typically commercial property developments that require funding for building work.

Mr Pepper said: “We know Prospect Property Group well. Their strong business model and entrepreneurialism - not to mention the fact that they are a Yorkshire business too - all contribute to their being an ideal candidate for our pension-to-peer loans. The business centres are performing really well, and our loans support other capital investment to provide working capital for the Group’s continued expansion.

“As we continue to amass a successful track record of property-based loans, which tend to average returns of more than 9 per cent a year for our clients, the pension- to-peer investment concept becomes ever more attractive. The loans are always secured against solid assets with first ranking security, which mitigates the risk, and we are able to give clients in-depth analysis of the businesses and projects we lend to.“

Grosvenor’s clients have been invited to make loans in 21 separate ventures, lending a total of £47m, with £27m being lent on high-profile projects in the past year.

Charles Cudworth, managing director of PBC, said: “Loan capital from Grosvenor has been an essential component of our balanced portfolio of funding, to support our working and expansion capital across our London centres. Â

“By relying on a combination of funding from our own reserves, as well as bank and the Grosvenor funding, we are able to balance our funding sources and reduce our exposure to changes in the markets.“

Among Prospect Property Group’s other Yorkshire interests include a commercial development and investment arm, Workpods Ltd, which is currently developing a £12m eco-friendly office scheme on its Robin Hood Airport International Business Park.

PPG also comprises the Luxury Lodge Group leisure business, which is developing a £12m luxury lodge scheme in North Yorkshire and has site options in Devon and Somerset. Heritage Care Villages, PPG’s high-end care resort developer, is currently developing a luxury 98-unit retirement spa village with dementia facilities. Long-term land options held by high quality house builder Loxley Homes have also boosted the group’s development activity in Yorkshire.

The company’s future expansion strategy is focused around long term projects within each of PPG’s businesses.

Warren Hill, chairman, said: “We have also worked with Grosvenor to provide funding for other projects and their competitive finance, which comes with the prerequisite of genuinely secured backing, has been invaluable in helping us to grow and maintain our momentum.“

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