M&G announced on Friday that it is joining forces with Ardcairn Capital to launch a new development finance lender in Ireland. The partnership is designed to make a significant amount of capital available to small and medium sized residential developers to deliver housing projects, with an ambition to provide funding for over 10,000 homes in the next five years.
The partnership is formed by M&G Catalyst strategy, which is investing up to £5 bn (€5.9 bn) into privately-owned businesses where capital is required to drive innovation and impact to create a more sustainable world. The vast majority of housing targeted through this partnership will be affordable, for first time buyers, and supporting social housing projects, where there is a chronic shortage.
Daire McCarthy, co-founder and CEO of Ardcairn Capital, said: 'Ireland continues to experience a significant shortage in housing stock – particularly affordable and social housing. Momentum in construction was halted as Ireland was hit by Covid-19 and we are starting to see this space recover gradually, but not enough to meet the reported 50,000 homes required per annum, and the investment it takes to reach this target. Partnering with M&G will help unlock financing for small sized housebuilders who have compelling opportunities but have been overlooked and under serviced by the market for some time.'
Alex Seddon, head of Catalyst, M&G, commented: 'Creating more, good quality, homes is a priority for most societies around the world, and also a priority for our strategy, which is channelling investment to help make this happen. We welcome this opportunity to partner with Ardcairn Capital to help overcome some of the barriers that smaller developers face in delivering affordable and social housing.'
M&G is a long-term investor into the Irish real estate sector through large commercial real estate mortgages, direct investments into real estate, a partnership with Finance Ireland to provide long-term mortgages, and through its partnership with Marlet which began in 2014. Through Marlet, M&G has invested over €1.2 bn, assembled a portfolio that will deliver over 8,000 homes and over 1 million sq.ft. of office space.
