Global co-investment platform – Shojin Property Partners – has secured the junior funding element of a £7m purpose-built student accommodation (PBSA) scheme in Leicester city centre, with the backing of 37 investors.
Financing the planning-approved construction of the six-storey PBSA scheme, Shojin is providing a £645,000 mezzanine loan, with Shawbrook Bank providing a development debt facility of £4.49m.
The new scheme is located close to both De Montfort University and The University of Leicester. The PBSA will offer students four 12-bed cluster flats and 13 studio flats and the scheme will include communal areas.
“Leicester is home to 55,000 students but there are just under 20,000 PBSA beds, which highlights an imbalance between demand and supply. We were delighted with the response from our global investor base, with the opportunity over three times subscribed and 37 participating at an average of c. £16,500, which demonstrates how the Shojin model is opening up deals like this to a new investor class.”Jatin Ondhia, Co-founder and CEO, Shojin Property Partners
The Marble Street development is the latest deal for the global marketplace for real estate investment launched in 2017 by entrepreneur Jatin Ondhia. Applying its fractional investment model, the company draws from a pool of investors in more than 40 countries interested in UK-based property deals – making it possible to access institutional-grade real estate opportunities for as little as £5,000.
“Leicester is a very strong market for PBSA developments and will continue to be so for the next few years as both Leicester and De Montfort universities expand their student offerings both to UK and overseas students. We have worked with Shojin to fund a recent 61 bed development in the city centre and look forward to working with them on future projects to expand our portfolio.”Kane Tang, Manager Director, Tang Developments
Operating in an online real estate investment market forecast to grow from $15bn today to $800bn by 2027, Shojin was created to democratise the market by opening up investment opportunities to professionals with investible funds of more than £100,000. Typically, institutional-grade property deals are only accessible to the top 1% of the world’s adult population, who control 45% of global wealth.
Shojin concentrates on residential, PRS, senior, and student accommodation projects providing investors with expected returns of 15-25% per annum. In the process of raising Series A funding, the company focuses on working with mid-market developers and providing £1m to £6m as traditionally they struggle to find consistent and trusted providers of junior finance – unlike senior debt. It offers investors four core products: Development Equity (higher risk), Mezzanine Loans (medium risk), Asset Investment and Bridge Loans (low risk).