Financefair launches €150m fund for social and affordable housing development

Irish business finance provider Financefair has established a €150 million fund for social and affordable housing projects with the aim of supplying working capital for the construction of up to 750 new homes across the State.

Aimed at “experienced residential developers”, the Financefair Social and Affordable Housing Fund will be managed and administered by Dublin-based Financefair with funding provided by London-based investment firm LCM Partners.

It will back the construction of homes for turnkey sale to approved housing bodies, local authorities and the Land Development Agency (LDA). Financefair will provide loans of up to 90 per cent of the total development cost or up to 75 per cent of net development value.

Helen Cahill, chief executive and co-founder of Financefair, said the company – which until recently was called InvoiceFair – had “quietly” begun working with midsized developers and construction companies in social and affordable sector during the pandemic.

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Its new partnership with LCM will now allow it to increase its activity in the area and help alleviate the “national problem” that is the housing crisis by enabling timely funding drawdown for the “unserved middle”, she said.

“For midsized companies, there is sadly very little choice out there for them to access the funding they need.”

The Financefair fund will also accelerate the building of homes by stepping in with working capital provision at an early stage in the process, Ms Cahill said.

While it could take six to nine months for a letter of intent or initial agreement between a developer or construction company with approved housing bodies, local authorities or the LDA to morph into a contract, Financefair will be “happy to come to the table” before it reaches this stage, she said.

“We think that the risk of that agreement not becoming a contract in the midst of a housing crisis is extremely low.”

Pricing is competitive with other nonbank finance providers, Ms Cahill added.

The company, which employs 35 people, was originally set up by Ms Cahill and its chief revenue officer Peter Brady in 2015 to help companies raise finance on the back of invoices, helping them to scale up their business. It has delivered €1.7 billion of working capital funding to date and has gone on to broaden its range of products for small and medium-sized businesses.

LCM Partners managing director Declan Reid said in a statement that its partnership with Financefair “reflects our commitment to sustainable development aligned to the need for social and affordable housing”.