London Treasury Liquidity Fund (LTLF) has announced a £30m investment into private real estate debt, providing senior development and bridging lending across the UK with a focus on affordable housing.

The £30m will be placed through Pluto Finance, an UK specialist real estate private debt manager. Other investors include the Universities Superannuation Scheme, also a major shareholder in Pluto, pension funds and other institutional investors from across Europe.

The commitment supports SME housebuilders across the UK who are central to the government’s plan to deliver 1.5 million new homes in the next five years.

AFFORDABLE HOMES

London and the South East will be a focus of lending activity: a recent loan closing is to finance a housing association’s development of 91 affordable homes and one commercial unit in Dagenham.

LTLF is an investment fund managed by London Treasury. It is designed for local authorities and public sector bodies who seek a higher level of return than SONIA or an average money market fund. An investor with fluctuating cash-flows, on its own is only able to invest in short-term instruments, but with LTLF it can share the benefits of longer-term investment. The fund is currently open to new investors.

SECURE RETURN

Richard Tomlinson, deputy chief investment officer at London Treasury, said: “We are delighted to have had the opportunity to invest £30m with Pluto Finance, we expect this investment to deliver a secure risk-adjusted return in excess of the portfolio’s benchmark at the same time as supporting the construction of new housing stock.

“As a fund, we are at an exciting stage. Our performance since inception in April 2023 has exceeded current benchmarks, and our operations have scaled sufficiently to welcome new investors who are eager to partner with us.”

Robert Swift, head of investor relations at Pluto Finance, added: “We are delighted to be working with the team at London Treasury and are aligned with their investment aim – competitive financial returns and the delivery of much needed affordable housing across the UK.

“In addition to new homes, lending in London and the South-East delivers local investment and SME job creation.”