What is Chapeltown Cohousing Limited?
Chapeltown Cohousing is a housing co-operative set up in 2002 and registered with the Financial Conduct Authority under the Co-operative and Community Benefit Societies Act 2014. We have an aim of providing, constructing, converting, improving or managing accommodation on co-operative principles. We are fully mutual – so all our members make decisions together. We are also not-for-profit and our rules prevent individuals taking profits or assets out of the co-operative.
What is loanstock?
Loanstock is a loan in the form of an unsecured fixed term, fixed interest bond. Loanstock is non-transferable (ie: it cannot be transferred from one person to another unless it is held jointly), and confers neither voting rights nor any control over the co-operative. In the event of the loanstock holder dying then the loanstock would pass on to their inheritor.
The full amount is repaid at the end of the loan along with all the interest you have earnt. Early repayment is possible at the discretion of Chapeltown Cohousing.
At this stage Chapeltown Cohousing is offering loanstock for a minimum of 4 years at lender-chosen interest rates ranging from 0% to 4%. However, as we are co-operative seeking to develop affordable housing, we offer this loanstock as an opportunity for those who share our vision to help us make it a reality, rather than purely as an opportunity to make a financial return on an investment. Choosing a lower interest rate offers us more support.
Please note that you can apply for more than one loanstock issue with different interest rates and different lengths of time.
Are there financial risks?
Yes. We are confident, based on our financial planning, that Chapeltown Cohousing’s plans are viable. However, please be aware that loanstock is treated as an unsecured loan and therefore carries an element of risk.
We have purchased the land and already obtained planning permission to develop housing, which means that Chapeltown Cohousing does have some substantial assets that can be sold. However, we cannot guarantee that we would be able to repay all or any loanstock in the event of insolvency or otherwise.
Both the development loan and the long-term mortgage are likely to be secured against the site. This would mean that if the loan repayments were not met, the relevant lender(s) would be entitled to take possession of the site and sell it to recover the outstanding amounts owed to it/them, ahead of payment of amounts owing to loanstock holders.
You should also be aware that Chapeltown Cohousing is not considered to be conducting (or authorised to be conducting) regulated activities by the Financial Conduct Authority, and investors therefore have no right of complaint to the Financial Ombudsman or recourse to the Financial Services Compensation Scheme. Therefore, the money you pay for your loanstock is not safeguarded by such scheme or any dispute resolution scheme.
Please consider the risks of investing in Chapeltown Cohousing carefully and, if needed, seek independent advice from an independent financial adviser or other person experienced with investments of this type.
Benefits of investing in Chapeltown Cohousing
- An ethical investment – with interest if you choose to receive it
- An opportunity to be a catalyst for change in one of the most deprived areas of the country
- High accountability: you know exactly where your money has gone
- No bankers’ bonuses
The Co-operative Advantage
Is being a co-operative good business? Yes, according to a report by Co-operatives UK, which revealed the following:
- Fairness – 75% of people in the UK think co-ops are fair, while only 18% think shareholder companies (PLCs) are.
- Trust – 66% think co-ops can be trusted, but only 29% think PLCs can.
- Honesty – 63% think co-ops are honest, compared with 15% who think PLCs are honest.
- Public good – 65% of people think co-operatives work for the public good, compared with 12% who think PLCs do.
Furthermore, according to the UK Co-operative Economy 2018 report the co-operative sector turned over £36.1 billion during the year and has proved extremely resilient over the last five years, amidst uncertain wider economic conditions.
The small print
Terms and conditions can be found in our full Loanstock Offer document. The form at the end is also available as a Word document (26KB). You’ll also get a chance to see our annual accounts, business plan and financial model.
Chapeltown Cohousing Ltd
Registered under the Co-operative and Community Benefit Societies Act 2014
Register No. 29376R
115 Spencer Place, Leeds, LS7 4DU