The Belong Limited Retail Charity Bond has raised £50 million and closed early due to high demand from investors.
The Bond, which was offered by Retail Charity Bonds PLC, was launched on 23 May 2018 and closed early at 10.00 on 31 May 2018. The proceeds will be used to further Belong’s charitable objectives as well as to develop additional Belong villages. It offered an interest rate of 4.5 per cent a year for a term of eight years. Within eight days the offer was oversubscribed and orders from investors had to be reduced or turned away. Belong will borrow £35 million initially when the bonds are issued on 20 June 2018, but a further £15 million of ‘retained bonds’ will be created which can be sold and the extra money loaned to Belong at a later date.
The Bond is the eighth and one of the largest to be issued through Allia’s Retail Charity Bonds platform since it was launched in 2014, taking the total raised through the platform to date to £192.5 million.
Belong is a charitable care provider that creates village communities enabling older people to live the lives they choose and, in particular, to enable people living with dementia to retain choice and independence over as many areas of their lives as possible. It was established in 1991 with the aim of providing a range of charitable care and support services to older people. Since then its role has evolved and today it is an award-winning provider of high quality, person-centred care, accommodation and ancillary services to older people.
In 2007, Belong opened its first village in Macclesfield, following years of research and development geared towards achieving the best outcomes for the rapidly growing number of people in the UK living with dementia, which is set to rise to over 1 million by 2025 and 2 million by 2051, according to Alzheimer’s Society statistics. The Belong villages provide 24-hour dementia and nursing care in bespoke households, as well as apartments for independent living, within a community village setting. Belong’s model provides for a full spectrum of care, from respite care to end of life care, enabling the Charity to continue to support older people as their needs change.
Belong currently operates seven villages, with the seventh having been opened in Newcastle-under-Lyme on 9 April 2018, providing a home for over 530 residents in the North West of England. Two more sites in Chester and Birkdale have been acquired, with planning permissions already secured, and development is expected to start on these in 2018.
The lead manager for the bond issue was Peel Hunt LLP.
Tracey Stakes, CEO of Belong, comments: “Belong villages offers a pioneering approach to later-life care that’s led by an individual’s needs rather than an institutions’ restrictions. As the number of people in the UK living with dementia continues to increase, so too does the demand for innovative solutions to where they can live and be cared for in a safe community environment. We’re therefore delighted to see such strong support for Belong’s business model, with the success of the bond enabling us to welcome a greater number of older people into more of our villages.”
Phil Caroe, director of social finance for Allia, says: “The success of this latest Retail Charity Bond – one of our largest issues to date - is a powerful endorsement from the market of the quality of Belong’s business and demonstrates the continuing strength of demand for ethical investment opportunities. Allia’s Retail Charity Bonds platform has again proven an effective means of raising funds, connecting charitable borrowers to mainstream investors and creating access to an attractive source of unsecured loan finance.”
