Prestige, a direct lending investment management group, is partnering with Goji, a direct lending / investment platform in the UK, to launch an ISA-eligible Renewables Lending Bond. The Bond will be designed to help wealth managers to access the steady returns that can be achieved from renewable infrastructure projects in the UK.
Prestige already owns companies that are active in helping to finance important renewable energy projects, like biogas plants, in the UK. These loans are typically secured against UK property and assets and are also supported by the UK government and long term revenue contracts.
The Goji Renewables Lending Bond will include:
- An attractive target yield of between 5.5% and 6.5% pa over a three and five year investment term respectively;
- Interest payments supported by government subsidies such as Feed-in-Tariffs;
- Loans will be originated by Prestige’s credit team, which has a 15 year track record in renewable financing;
- Diversification across approximately 40 renewables projects, across different sub-sectors (wind, solar, biomass) – this means repayments are being supported by a range of revenue generating sources.
“Our direct lending strategies already enjoy considerable support from a diverse range of international investors,” commented Craig Reeves, Founder of Prestige. “This bond is designed to allow UK investors to access a specific revenue stream from within those strategies, namely the yield generated by established renewable energy projects we already finance within the UK. These projects are also often secured against land, long term government contracts and other assets.”
Support from the UK government for renewable energy is strong because the UK must honour its commitments to meet green energy and zero waste targets in 2020 and 2030 respectively.
Additionally, given the recent increased uncertainty around many equity and bond markets it would also seem that alternative investment strategies are becoming more relevant now and there has never been a time in recent history to provide investors with a genuine alternative inflation hedge in an increasingly uncertain and volatile world.
Jake Wombwell-Povey, CEO of Goji, added: “Renewables infrastructure and socially responsible investing are continuing to rise in prominence within the wealth management market. Goji’s Renewables Lending Bond offers practitioners in this market, and their clients, the opportunity to tap into the attractive returns that can be earned from these heavily secured projects – all without the exposure to market volatility that comes with traditional fixed income.”