We will be financing the christian cohousing co-op in South Wales in a variety of ways.
We have already approached a christian investment bank who are interested in principle in the project. Obviously, until we know the types and number of houses to build and the cost of land we can not get a definite offer of investment. But if we can work the numbers then a large part of the cost will be covered by a 20-year commercial mortgage held by the co-op and secured on the land and buildings.
The modular buildings we are looking at developing all have a useful life of at least 60 years before having to undertake large-scale refurbishment. There will be ample time for the co-op to build a reserve of funds to finance this refurbishment after the paying off of the mortgage.
The co-op will also offer loan bonds valued at £1,000 each and offering an interest rate of 3% over base rates. This offers a competitive return for savers and investors and a cost-effective means of financing for the cohousing project. There will be limits to the number of bonds any one investor can hold to prevent any one institution or individual holding financial power over the co-op. The aim will be to buy back the bonds after 10 years with cash coming from either the reserves or a re-issue of bonds.