Market finance supports charity

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Why would a charity want to become listed on the London Stock Exchange? Can new financing options be helpful to assist the most marginalised members of our society?

Golden Lane Housing is an inspiring organisation, whose example may answer those questions. It is an example of commitment to social impact and ambition to help more people by learning to use different financing options.

Golden Lane Housing (GLH) is the UK’s leading supported housing landlord for people with a learning disability. GLH works with its beneficiaries to provide them with housing, around which they can build their lives. It was established as an independent charity in 1998 and was able to issue the first retail charity bond on the London Stock exchange in 2014. In 16 years GLH invested over £83 million transforming the lives of 1,400 people. It went from a mainly grant-funded organisation to a charity whose 600 properties in England and Wales are mostly (68%) financed by loans, investments and repayable grants today.

GLH started to engage with bonds in 2003 when it raised £1.8m through a 10 year bond to finance property acquisition to expand the available housing pool. This was the first retail bond issued by a national charity. According to GLH “as in 2003, the net assets of Golden Lane Housing were only £280,000, the 2003 bond was truly transformational; it helped the charity to achieve a step change in its growth and to provide long term, adapted homes in the community.”

In 2013 GLH raised £10m through a successful bond issue, which enabled them to buy 27 properties and thus provide high-quality homes to an additional 99 people. The bond was oversubscribed and was purchased by 700 individual and institutional investors, charitable trusts and foundations – the City of London Corporation Social Investment Fund (COLCSIF) being one.

The latest chapter of GLH’s successful financing story is the 2014 Retail Charity Bond issue, which raised £11 million in two weeks and is listed on the London Stock Exchange.

Golden Lane Housing took many years and a step-by-step approach, experimenting with a mix of finance that seemed most appropriate for achieving its strategy. It wasn’t overnight that GLH became a listed charity. City Bridge Trust’s Stepping Stones Fund did not exist when GLH started its journey, but it is there now, open to London charities that want to innovate and experiment for better social outcomes. The Stepping Stones Fund is awaiting applications from organisations that want to take the GLH route and are looking for a partner.

Visit the Stepping Stones Fund web pages to find out how it can help your organisation become ready for social investment and other types of finance.

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