Start-up funding is designed to help you go through the 5 W’s and an H questions - What? When? Where? Why? Who? And How? in the early stages of your project.
CLT Start Up Fund - The CLT Start-Up Fund offers support and funding to CLTs in three stages. Stages 1 and 2 offer the opportunity to meet with CLT experts to discuss initial ideas and offer advice and guidance. At Stage 3 CLTs may apply for a grant of up to £4000 to formally set up the CLT and develop a business plan. Stage 1 and 2 applications are considered on a rolling basis and the Fund committee meet every 2 months to consider new Stage 3 applications.
Community Buildings and Housing Grant Programme - There are two grants available under this government scheme: the Community Buildings Pre-Feasibility Grant of up to £10,000 and the Community Buildings Project Support Grant of up to £40,000. The Pre-Feasibility grant can help a CLT to assess feasibility prior to submitting a Community Right to Build Order or a traditional planning application and the Project Support grant is designed to help progress such applications to the point of submission. Applications for grant for 2017-18 can be submitted from 1 February 2017 until 31 January 2018.
Power to Change: Community Business Fund - Power to Change is an independent charitable trust set up in January 2015 who are using a £150m endowment from the Big Lottery Fund to support community businesses in England. From their Business Community Fund they are awarding grants of £50,000 to £300,000 to help with a wide range of costs. The trust has already successfully carried out three rounds of the grant and plan to open the fourth between 7th June - 5th July 2017. Click on the link to see if you are eligible!
Community Housing Fund - As of December 2016, 148 local authorities have been granted access to a £60 million government fund, headed by the DCLG, to support community-led development projects in their area. It is a huge boost for community land trusts and we are already working closely with several district councils across the East of England who are keen to implement the CLT model to address the lack of affordable housing in their area. If you'd like to find out if your local area could benefit from the fund, please do get in touch!
Local grants – Local authorities, town or parish councils and local or regional charities are increasingly aware of CLTs and can be willing to support CLTs in their early stages. Support provided may include start-up grants, in-kind technical expertise or access to facilities.
To build your project you'll need development finance. You'll need capital funding to buy the land or assets and build the homes and you'll need revenue funding to manage and maintain rented properties.
The CLT Social Investment Fund - The CLT Social Investment Fund is part of the CLT Fund and is managed by CAF Venturesome. It provides both pre-development finance of up to £100,000 and developments loans of up to £400,000 to help CLTs to progress their housing schemes. The loans are designed to get homes built and to help attract further finance from mainstream lenders. Loans are repayable with interest.
The Affordable Homes Rental Fund - This fund is operated by Community Land and Finance CIC, a community development finance institution managed by Resonance Ltd. It lends up to 100% of the capital required by a CLT to build affordable homes. The fund is designed in such a way that within 8 years the CLT should be able to refinance and obtain a conventional 25 year capital replacement mortgage.
The Community Investment Fund - The Community Investment Fund provides loans of between £250,000 and £2m to community-focused, locally-led organisations. Social and Sustainable Capital, the managers of the fund, are keen to engage with CLTs looking to raise development capital to improve social outcomes in their area. Loan repayments are through sale of property or loan refinance, depending on the business model
Big Potential – Big Lottery Fund has announced an additional £10m for its investment readiness programme, Big Potential, meaning that a total of £20m is now available to Voluntary, Community and Social Enterprise (VCSE) organisations.
Home Building Fund - A possible course of action for any communities that are interested in self-build. The Home Building Fund is a £3 billion fund issued by the Homes and Communities Agency (HCA) with the aim of increasing the number of homes built in England. It is open to a host of projects, including community-led, and provides loan funding for the development costs of both site infrastructure and the building of your homes.
Lenders - Some examples of charitable and ethical lenders that have funded CLTs previously are are keen to lend in this sector include: Charity Bank, Ecology Building Society, Triodos Bank, Unity Trust Bank, Big Issue Invest and CAF Venturesome. Banks or building societies will often only lend up to 60-70% of the capital needed so this will need to be topped up by other means.
Government - The Government itself operates grant and loan programmes that may be open to CLTs. Currently the Shared Ownership and Affordable Homes Programme 2016 – 2021, the Coastal Communities Fund and the Custom Build Serviced Plots Loan Fund are all available for CLTs to apply to, please contact us for more details.
Community Share Issue – Community shares have raised millions of pounds in the last five years to enable village shops and pubs to be saved, to support community-led renewable energy projects and to invest in local social enterprises and workers' co–operatives.
Low-cost community share issues are possible because of two things. Firstly, community Benefit Societies can issue withdrawable shares – shares which investors can, or should be able to, cash in on request to get the money back that they invested. Secondly, withdrawable shares are exempt from the rigorous requirements normally imposed on public share offers under the Financial Services & Markets Act. It means community share issues, on average only for about £200,000, can take place without the need for extremely expensive lawyers' and advisers' fees.
Crowdfunding – Numerous websites have sprung up offering one version of crowdfunding or another. The websites allow those seeking finance to publish details of their project including how much cash they need, how they will use it and how investors stand to profit (if at all) in future. Some of the sites vet the fund-raisers – others don't. In most cases the investors, who can usually subscribe as little as £10 per venture, are offered ‘shares’ in the business venture.