Below is a copy of a letter from BHCLT updating on the share offer and notifying of an extension and changes to some offer terms. This was sent to all existing investors via email on 17th August 2020:
Dear BHCLT investors,
Firstly, thank you so much for investing in our share offer. It has been incredibly heartening in these times to see that people are still willing to invest in creating better, more affordable, sustainable housing for different groups of people who need it.
COVID-19 has meant we’ve had to rethink our initial investment proposition. Our aim was to raise community shares for a portfolio of projects across Brighton & Hove. The pandemic has meant that some of these projects are now going to take longer to develop, as well as impacting the amount we think we are able to raise given the economic uncertainty affecting so many people.
We have reshaped our offer around our first and most immediate project to buy a large property, which we will lease to SEASALT, a student housing co-operative. This project is about creating affordable, high-quality housing for young people who are some of the most likely to face exorbitant rents, unresponsive landlords and poor-quality housing.
Our long-term aims remain the same – to support a range of projects across the city to develop their own housing solutions to shared housing needs. If we are successful in this share offer, we will know that there is capacity to mobilise investment around community led housing and will look to further share issues. As we establish capital assets, we will be in a stronger position to leverage funding to expand and develop new projects.
As investors, the terms that will change are as follows:
- We have extended our deadline from 31st August to 31st October (with the possibility of a further 6-month extension if decided by directors)
- We have a lower minimum target of £260,000 rather than £385,000
- We are still expecting to pay 3% interest annually, but this will now start to accrue earlier, so from January 2021 (rather than August 2022)
- We will accept requests for withdrawal from October 2022 (also a year earlier than previously advertised)
Our new share offer document and accompanying business plan can be found on the Ethex website https://www.ethex.org.uk/bhclt and in the accompanying email to this letter. We have also received the Community Shares Standard Mark, which is awarded to offers that meet national standards of good practice.
As this change represents a change to the terms of the offer under which you invested, we need to be clear that everyone who has already invested is happy to remain an investor. We are inviting investors who DO NOT accept these new terms and wish to withdraw their investment to contact Ethex at email@example.com. They will cancel your order and refund the investment you have made.
Everyone else who we DO NOT receive any indications from will be assumed to be content with these changes and their investment will remain in the share offer, subject of course to us hitting our target.
On this final point, if you remain supportive, we would urge you to examine whether you might increase your investment in the share issue. The world has changed in many fundamental ways, and given the economic situation, our plans to get investment from lots of ordinary people for lower amounts will inevitably be hit. As a result, we need to secure a greater amount from people who support our vision and who are still able after Covid-19 to commit to invest to help us make a start on building a new land and home ownership system in Brighton and Hove.
Even if you can’t increase your investment, we would ask if you can do any of these things which will still be very helpful to us:
- If you work in organisations which might be able to invest themselves, can you make an introduction to the people who make these kinds of decisions? Can you be our champion in your organisation to help us get them to invest?
- Are you involved in networks (or have family members) of people who might want to make a safe, property-backed investment that pays a much better return than bank savings rates, whilst being a ethical investment that will genuinely make a big difference to people in the city? If so, can you make people in those networks aware of our share issue?
- Do you have a strong online presence either individually or organisationally, and can you use your profile to promote our share issue? If so, follow us on twitter at https://twitter.com/bahclt where you can retweet our content, and on Facebook at https://www.facebook.com/BaHCLT/ where you can share it amongst your own friends and family.
If you have any questions, or need any further information, don’t hesitate to get in touch at firstname.lastname@example.org
All the very best
On behalf of BHCLT directors