Alpha group launches new development fund

Alpha group launches new development fund

After committing over £400 million to projects, a London-based group has launched a new property development lending business to the whole market. Jason McGee-Abe spoke to Steven Oliver.

After committing over £400 million to projects, a London-based group has launched a new property development lending business to the whole market. Jason McGee-Abe spoke to Steven Oliver, Deputy Managing Director at Alpha Real Capital, to find out more…

B&C: When was the new lending business launched?

AC: The current lending business was launched in late 2012 with our first loan approved in December of that year. Since our launch we have been building our pipeline of transactions resulting in nearly £10 million of approved facilities and over £33 million of facilities in our pipeline. We pride ourselves on our service and turnaround times and our knowledge of the development process.

What specialist funding structures do you offer?

We offer a traditional senior debt product and we have access to a specialist joint venture structure; however our current focus is on growing our senior debt lending business. We will only lend on fully consented sites and will not take planning risk.

Our focus is on lending to established and well run developers who have a good track record in their chosen location. We will typically consider developments of up to £10 million GDV and typically we can consider loans of up to 65 per cent of GDV.

Our senior debt product maintains a focus on London, South East and other prime areas of England and Scotland with a typical term of up to 24 months. Our typical facilities are between £1 million to £8 million.

Our joint venture product maintains a similar geographic focus and similar term; however it is a profit participation model rather than a straight interest and fees model.

What’s the structure of Alpha Real Capital?

Alpha Real Capital was established in 2005 and is an international property fund management group with around £1.4 billion under management. Headquartered in London, Alpha operates a network of offices in the UK, Europe and Asia.

How much funding do you have?

Alpha and its financial intermediary-facing business - TIME Investments manage both institutional and retail capital. Our property lending business has access to approximately £130 million of capital through a specialist vehicle called CTC, which has a 16-year track record. During its 16-year life, over £400 million has been committed to CTC projects, the majority of which have focused on residential property development.

How big is the team currently?

Alpha has 64 staff and the front office of the property lending business is made up of the following executives:

? Steven Oliver, Deputy Managing Director: I became a partner of Alpha having previously worked at Close Brothers, Barclays Bank PLC and Santander. My key focus is on establishing and growing the property lending business within Alpha.

? Stephen Daniels, Divisional Director: Stephen joined Alpha in 2011 following four years at Close Brothers. Stephen previously worked for Accenture and is a qualified accountant.

? Jill Hagland, Divisional Director: Jill joined Alpha in 2013 following an extensive 27-year career at Investec, specialising in property lending.

? David Blake, Assistant Director: David joined Alpha in 2011 following a career in project management and quantity surveying. David was previously employed at McBains Cooper and has extensive knowledge in construction and development.

? Dean Brown, Assistant Director: Dean joined Alpha in 2011, following four years at Close Brothers. Previously, Dean worked for Santander in its specialised underwriting department which focussed on residential property lending.

In February 2011, Alpha acquired the Close Brothers Group’s property division, could you explain the background to this deal?

Alpha Real Capital acquired the property fund management arm of Close Brothers in February 2011. The transaction resulted in an increase in Alpha’s funds under management of approximately £560 million and all staff employed in the Close Brothers property fund management arm transferred to Alpha.

Where do you see Alpha in the market?

Given our time and history in the market we see ourselves as a complementary form of finance for our borrowers. These borrowers probably also have banking relationships with other lenders in the market but want to diversify and expand their banking relationships with an experienced, knowledgeable and active lender in the market.

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