INVITATION TO INVEST
London Community Land Trust
A Community Benefit Society registered
as London Citizens’ CLT Limited
Registered No 30238R
Issue for Shares in London Citizens’ CLT Limited ‘Share Offer’
FEBRUARY 2016
1
OUR SHARE OFFER IN BRIEF
STATEMENT FROM PAUL REGAN
Issue for Shares in London Citizens’ CLT Limited
Investing in London CLT (short for Community Land Trust) will put
housing in the hands of the communities of London for the first time
in my lifetime; and keep it that way for the generations to come.
‘Share Offer’
OPENS: 19TH FEBRUARY 2016
CLOSES: 19TH APRIL 2016
London Citizens’ CLT Limited (“London CLT”) aims to create
permanently affordable homes for local families in one of the most
expensive cities in the world. It is the first CLT in London.
Our inaugural development at St Clements in the east end of
London, as East London CLT, is providing 23 homes at prices
permanently linked to median incomes, rather than to market prices
that increasingly outstrip ordinary people’s ability to pay them.
By investing in London CLT, you will help us bring forward our next
scheme in Lewisham, for 12 homes, and the next for up to 100 more
at the Olympic Park, where a CLT has been promised a presence by
the Mayor of London and is a requirement for the developer.
We have more than 1,500 members already and we’d like you to join
with them by investing in something special: creating permanently
affordable housing in London, owned and democratically controlled
by Londoners with the intention that it is affordable now and
affordable forever.
As a member and an investor, we expect to be able to pay you a 5%
financial return on your money, so you can do well and do good.
It’s an investment we want you to be proud of.
2
For too long, housing in London has been about money; profit and
price. We want to change that. We want it to be about home,
family, and community. It’s an ambitious thing to say, never mind an
ambitious thing to do, but we’ve found a way.
A community land trust for London, instead of maximising the profit
from building houses, sells them at prices people can afford by not
taking the profit, and passing on the difference to the new owners
as affordability, defined relative to average local incomes. More
than that, it will keep it that way, by connecting the cost of its
homes to earnings rather than house prices, and gently but carefully
keeping control of future sales so the houses will be affordable for
generations to come. It means we effectively remove the kind of
property speculation that contributes to housing boom-and-bust
at the same time as giving our residents a stable home for as long
as they want it. In turn, we believe that this will enable them to put
down roots, enjoying where they live as well as contributing to it.
Our owners will not be tempted to think of their house as
an investment, but as a home. Which is what we think a house
should be.
We’re inviting you to share in this vision by investing in London CLT.
Together, we can change housing in London for the better, forever.
Paul Regan
Chair, London Community Land Trust
3
KEY
FACTS
Offer document approved
by the Board of London CLT on:
20th January 2016
Offer opens:
19th February 2016
This Share Offer is seeking
to raise £450,000 through
the issue of shares at a
nominal value of £1 each
from potential members
across the United Kingdom.
Amount sought:
£450,000 (with a minimum of £150,000)
Minimum investment:
£100
Maximum investment:
£100,0001
The shareholding is by
open subscription with a
minimum shareholding
of £100. Membership is
primarily sought from
people with an interest in
housing provision in London,
and other social investors.
Corporate vehicle:
London Citizen’s CLT Limited is a Community Benefit
Society under the Co-operative and Community
Benefit Societies Act 2014 and is registered in
England as LONDON CITIZEN’S CLT LIMITED with the
Financial Conduct Authority.
The purpose is to prepare a series of
developments of affordable homes
across London for construction. The first
is a scheme of 12 homes in Lewisham,
which is at advanced feasibility
stage, but there is also the chance
to bring forward the next scheme at
the Olympic Park, and explore other
opportunities for CLT homes across
London. All of these will be permanently
affordable homes in London, owned
and democratically controlled by
Londoners through London CLT,
affordable now and affordable
for generations to come.
4
Offer closes:
19th April 2016 unless extended
by the Board of London CLT
Registered Number:
30238 R
Starting paid-up capital and
reserves of the society:
£695
THANK YOU FOR
CONSIDERING
THIS OFFER
Please note: London CLT
Limited is registered with, but
not authorised by, the Financial
Conduct Authority. Members
are not protected by any right
of recourse to an ombudsman,
any financial services
compensation scheme or any
deposit guarantee scheme.
1
Larger amounts can be invested through loan
stock. Please contact our corporate advisers,
Resonance Limited, for details.
5
CONTENTS
2
OUR SHARE OFFER IN BRIEF
30
YOUR INVESTMENT
3
STATEMENT FROM PAUL REGAN
SHARE OFFER TIMETABLE
4
KEY FACTS
6
CONTENTS
8
OUR STORY
9
WHAT WILL YOUR INVESTMENT SUPPORT?
10
IMPORTANT INFORMATION
17
KEY OPERATIONAL TEAM
18
OUR ADVISORS
19
KEY PARTNERS
21
THE SOCIAL CASE
22
A BRIEF INTRODUCTION TO CLTS
23
THE HOMES WE WANT TO DELIVER
23
TOTAL PROJECTED INCOME
24
TOTAL EXPECTED EXPENDITURE
24
SURPLUS/DEFICIT
24
NUMBER OF HOMES DELIVERED
25
SOURCE AND APPLICATION OF FUNDS
25
STEWARDING YOUR MONEY
30
WITHDRAWING CAPITAL
RETURNING CAPITAL
32
32
HOW MIGHT MY INVESTMENT WORK IN PRACTICE?
CAN I HOLD SHARES ON BEHALF OF CHILDREN?
32
HOW TO INVEST
THE BENEFITS OF INVESTING
31
WHO CAN INVEST?
HOW MUCH CAN YOU INVEST?
31
14 OUR TEAM AND OUR PARTNERS
THE BOARD
30
30
AIMS AND BENEFITS OF LONDON CLT
14
SHARE TYPE
30
12 SUMMARY: INVITATION TO INVEST
13
30
33
CAN WE HOLD SHARES IN JOINT NAMES?
CHARGES & RUNNING COSTS
33
34 TERMS AND CONDITIONS FOR APPLYING FOR SHARES
YOUR APPLICATION
34
34
YOUR PROMISES TO US:
34
34
DISSOLUTION, DEMUTUALIZATION, OR WINDING-UP
CANCELLATION OF OFFER
34
YOUR PAYMENT
34
DIRECTORS’ DECLARATION
36
OTHER LEGAL STUFF WE NEED TO TELL YOU
APPLICATION FORM FOR PURCHASE OF SHARES IN LONDON CLT LTD
38
40
HOLDING SHARES ON BEHALF OF CHILDREN AND NOMINATION OF SHARES ON DEATH
26 RISK FACTORS
Supporting documents
available for inspection2:
London CLT Rules
Last 3 years’ audited
accounts for London CLT
Business Planning
Documents
2
6
ou may inspect these during normal business hours with prior arrangement at: 112 Cavell Street,
Y
Whitechapel, London, E1 2JA or request them by email from info@londonclt.org |
www.londonclt.org
7
OUR STORY
Our CLT has campaigning roots stretching back
over 10 years. We were established by the
community organising charity Citizens UK, with
whom we continue to work closely, to provide
permanently affordable housing on the 2012
Olympics site. Citizens UK is an alliance of faith,
educational, labour and other community
organisations that ‘works to build the power of
communities to act together on issues of social
justice and the common good’. In thousands
of conversations over the past decade, its
members have consistently identified stable,
affordable housing as one of the top priorities
for people in the capital. We exist to help meet
this need for all Londoners who find themselves
unable to live affordably and stably in the
capital. We are doing this as a community
owned and governed not for profit – a social
enterprise with a sustainable financial model.
Citizens UK secured the promise of a CLT on
the Olympics site from successive Mayors
of London, ensuring that this became a
requirement for development. This also led to
East London CLT, with the support of Citizens UK,
securing a deal for 23 permanently affordable
homes at St. Clement’s in Mile End, the first
CLT in the capital. The scheme has gone on to
win the National Housing Awards in 2014 with
our partners, the GLA, Galliford Try and Linden
Homes, Peabody and JTP architects.
Since then, we have been invited by different
groups to support their work across the capital.
Most recently, Lewisham Citizens invited us to
work with them. They thought they could get
a commitment from the Mayor of Lewisham
to get a CLT in the borough – they were right.
We have been collaborating with them and
the council to identify a suitable site. Similar
conversations have been happening in other
areas, such as Croydon and Southwark.
Increasingly we felt that a London-wide
organization could deliver local ownership, only
going by invitation, at the same time as not
having to reinvent the technical and practical
understanding and relationships to enable the
delivery of a CLT in Lewisham or other locations.
London Citizens’
CLT Limited is a Community
Land Trust registered with the
Financial Conduct Authority
as a community benefit
society (registered number
30238R). Our registered office
for correspondence is
112 Cavell Street,
London, E1 2JA.
Type: A
Membership (Compulsory)
Type: B
Withdrawable (Optional)
A
VOTE
One
member
£1
One
vote
No interest
Members can buy one share for £1
Pre-election
commitment from
London mayoral
candidates, including
Boris Johnson and
Ken Livingstone, to
establishing a CLT
on the Olympic
Park
Available only
to type A members
£100+
VOTE
No
vote
Up to
5% interest
Members can buy
£100 – £100,000 worth of shares
Citizens UK are
asked by the
GLA to pilot a
community land
trust in London to
test the concept
Citizens UK secure
the promise of CLT
homes as part of
the legacy of the
Olympics
2004
2006
Citizens UK
establishes East London
CLT as a Community
Benefit Society, an
autonomous not
for profit
2008
We hope that these will be amongst the first
of many people-powered housing projects
using the CLT model. By supporting this share
offer, you can help us make this happen.
Community-led development and permanently
affordable housing owned by local people
may be exceptional – we are committed to
making sure that they are not the exception.
East London CLT joins with
the GLA, Galliford Try, JTP
architects and Peabody to
work on St Clements and
develop 23 CLT homes
in London as part of the
redevelopment of the
former hospital
Pre-election commitment
from London mayoral
candidates, including Boris
Johnson and Ken Livingstone,
to establishing a CLT on the
Olympic Park. Boris Johnson
pledges support for a network
of community land trusts
across the capital
St Clement’s wins
the National Housing
Awards as well as
the best in planning
category. Construction
work starts
East London
CLT and Citizens
UK identifies St
Clements as
the pilot site for
London’s first
CLT
2010
The leaders of Croydon and Redbridge
councils have both visited St Clements in
the last three months. Both leaders have
also committed to working closely with their
respective chapters of Citizens to develop CLTs
in their boroughs.
2012
2014
WHAT WILL YOUR
INVESTMENT SUPPORT?
EAST WICK
& SWEETWATER
REDBRIDGE
HACKNEY
PUDDING MILL
NEWHAM
TOWER HAMLETS
SOUTHWARK
LEWISHAM
CROYDON
You will be supporting us to make progress in building homes
which will stay affordable for local people on multiple sites across
the capital. Each development needs money as well as our time
to secure land and design the houses. Whilst not every prospective
site will necessarily come to fruition, the resources from the share
offer should ensure that we can make some of them happen,
meeting our social objectives in a sustainable way.
Near term – sites requiring
resources in 2016 and 2017:
• Lewisham - we are in discussions with
Lewisham Council about a site in the
borough. This will be our first direct
development, where we manage the
professional team and construction. We
estimate that this could lead to 12 new CLT
homes for sale, built in 2017 and sold in 2018.
• East Wick and Sweetwater are the next
phases of development of the Olympic site
for over 1200 homes. These are being built
by a joint venture of Balfour Beatty and
Places for People. We are hoping to secure
100 homes spread over 5 years.
• St Nicholas’ Church, Newham. We have
submitted a proposal for 14 homes with
our partner Igloo Regeneration and are
awaiting a response from the Roman
Catholic Dioceses of Brentwood
• Southern Grove, Tower Hamlets. This will be
a competitive tender process and the CLT
component, estimated at 10 homes, will be
part of a larger development, much like St
Clements. We estimate that homes might be
ready in 2018.
Interest develops
across multiple sites
in London, including
political commitments
from five council leaders.
Particular progress is
made in Lewisham
Medium term onwards
• The London Legacy Development
Corporation has two further stages of the
Olympic Park development to procure,
Pudding Mill and Marshgate Wharf, which
we will be pursuing.
• Southwark Citizens secured a commitment
from the leader of the council in 2014 to
work with them on a community land trust
in the borough.
• Hackney - we have held exploratory
conversations with church groups in
Hackney about using church land for CLT
housing at the same time as supporting
community facilities.
• Croydon and Redbridge - both councils
are exploring CLTs and have committed
to them in their Fairness Commissions. We
have met with the leaders of both. The
scale is unknown but we anticipate a
minimum of 50 homes on each, with the
potential for substantially more. Assuming a
three year timeline from now, homes could
be built in 2019.
All successful sites are intended to be part of London CLT,
forming part of our democratic structure.
East London CLT
becomes London
CLT. Feasibility
study carried out
on Lewisham site
2016
We are also open to collaborative arrangements and
opportunities with other CLTs if they want assistance, which
could be an additional revenue stream.
11
SUMMARY: INVITATION TO INVEST
IMPORTANT INFORMATION
The Board of London Citizen’s CLT Limited (London CLT) accept
responsibility for the information contained in this document.
To the best of their knowledge, the information contained in
this document is in accordance with the facts and contains no
omission likely to affect its substance.
Prospective investors should read the whole text of this document
and are advised to read with particular care the sections of this
document headed ‘Terms and Conditions for Applying for Shares’
and ‘Risk Factors’ on pages 34 and 26 respectively.
This invitation to subscribe for shares in London CLT is exempt from
the regulations arising from the Financial Services and Markets
Act 2000, because it is the issue of withdrawable shares in a
Community Benefit Society. You do not therefore have the level
of protection that you might otherwise be offered by the Act. A
community benefit society like London CLT is registered with but
not authorised by the Financial Conduct Authority.
The money you pay for your shares is not safeguarded by any
financial services compensation scheme, any deposit guarantee
scheme or any right of recourse to an ombudsman.
These are not shares that can be traded on the Stock Exchange.
Should London CLT get into financial difficulty:
• We may have to suspend your rights to withdraw your shares
• We may have to write down the value of your shares
• You may lose all the money you pay for your shares
As a long term investment, you should buy shares only with money
you can afford to have tied up, without interest, and without
capital appreciation, for several years or more. You should buy
shares only with money that you can afford to be without.
This is an invitation to subscribe for shares in London Citizens’ CLT
Limited (“London CLT”), registered in 2007 as a Community Benefit
Society under the Co-operative and Community Benefit Societies
Act 2014 (Registered Number 30238R).
London CLT aims to raise £450,000 towards new community-owned
affordable housing across London, beginning with identified
sites in Lewisham and the Olympic Park. Additional funds such
as those required for building the homes will be secured through
partnerships with developers or through loan finance. This share
offer is aimed at people (or organisations) who wish to support the
work of the CLT by becoming a member and buying equity shares.
On our first development at St Clements, the cost of building the
homes has been secured through a partnership with a major
developer; they build our properties, which we buy at a preagreed affordable cost, and we then sell them to our occupiers
covering our costs but not taking a profit, re-investing any surpluses
in developing more affordable homes.
For our next development at Lewisham, we expect to borrow the
costs of building the homes from a bank, engage a construction
company to build them, and then sell the homes to our occupiers.
The outcome is the same: permanently affordable3 homes in
London for Londoners. The CLT acts as the guardian of allocations
and affordability. Only the method is different since, in the first
example, we don’t borrow the construction finance and in the
second, we do. For future sites, we expect some, like the Olympic
Park, to work like St Clements and some to work like Lewisham.
Investors have the opportunity to invest between £100 and
£100,0004, with shares valued at £1 each. These shares can be
withdrawn in accordance with London CLT’s rules, but not sold,
exchanged, transferred (except on death or bankruptcy) or
traded on any Stock Exchange and their value will not increase.
Interest will accrue from 1st April 2017 for shares issued as part of
this offer.
Corporate advisers:
Solicitors:
Bankers:
For all enquiries contact:
Resonance Limited
42 St Thomas Road,
Launceston PL15 8BX
Anthony Collins Solicitors
134 Edmund St,
Birmingham B3 2ES
London Citizen’s CLT,
112 Cavell Street,
Whitechapel, London, E1 2JA
Tel 0345 0043432
0121 200 3242
CAF Bank Limited
25 Kings Hill Avenue,
Kings Hill, West Malling,
Kent ME19 4JQ
03000 123 456
Email: info@londonclt.org
email info@resonance.ltd.uk
web www.resonance.ltd.uk
12
Tel: 0208 819 9165
London CLT expects to pay the first interest for the 2017-18
financial year during the summer of 2017. London CLT anticipates
being able to pay 5% interest on shares and the expected rate of
interest will be notified to investors during December each year.
However, a return on your investment is not guaranteed and this
should be regarded as a social, rather than a financial investment.
Board members will not be paid a salary but London CLT has other
costs, including staffing, finance, marketing, site development,
legal and other professional fees, and administration. For
example, the revenue expenditure for the 2016-17 financial year is
budgeted to be c. £160,000.
3
t St Clements, London CLT has secured a
A
250 year lease on its homes. Homes will be
sold on a long lease with prices limited by
a resale price covenant linked to average
local incomes. The freeholder of the lease at
St Clements is a community foundation. Our
intention is to apply the same principles on
all other developments.
4
Larger amounts can be invested through
loan stock, please contact our corporate
advisers, Resonance Limited, for details
13
AIMS AND BENEFITS
OF LONDON CLT
“The best
legacy for the
idea of the
Olympic Games”
Our mission is to deliver permanently affordable housing in London, ensuring
that people are no longer priced out of the neighbourhoods in which
they have roots. We also seek to improve amenities for local communities,
enhance the wellbeing of those who live and work locally and enable
people to build thriving, inclusive communities through the democratic
ownership and stewardship of land and other assets. We seek to benefit
people who are in serious housing need because they are unable to afford
to purchase or rent a home large enough for their family needs.
Danny Boyle, film director and
supporter of Shuffle Festival,
on East London Community
Land Trust
In the words of some of our potential residents, partners, and commentators:
“This innovative
housing scheme has the local
community at the heart of it and is
delivering permanently low cost homes
and creating jobs. I hope this is the first
of many such schemes that transforms
empty sites and helps ease housing
demand. I’d like to congratulate Linden
Homes and the East London Community
Land Trust and all the partners involved
for working with us on making this
dynamic scheme a reality.”
Mayor of London,
Boris Johnson on St
Clements
“The community has
always been at the heart of this
initiative, which is using land owned
by the Greater London Authority,
and I’m pleased the project is
moving forward at an
exciting pace.”
Richard Blakeway,
London’s Deputy Mayor
for housing, land
and property
Catherine Harrington,
National CLT Network
director
14
Suzanne Gorman,
local resident and CLT
board member
Photo: Jess Sutton for Shuffle Festival
“So many
people said CLTs
couldn’t be done in an urban
setting. The success in east
London has been so important.
There is a real sense now
that the movement has
arrived.”
“The places
we live should be
affordable, and the way they
look and work should be driven by
local people. As a local family of five
we cannot afford to stay in our current
property. We are part of the local
community, our children attend school in
the area and it’s where our friends and
work are. We want to stay in the area,
and the community land trust is the
best opportunity we have to be able to
afford to do so.”
15
OUR TEAM AND OUR PARTNERS
Dave Smith
THE BOARD
The Board is democratically elected from the
membership of London CLT, with one third
of board members retiring each year at the
Annual General Meeting. One third of the
board is drawn from prospective residents,
one third from community representatives
and the remaining third from stakeholders
with particular professional experience. The
stakeholder membership class can also include
Paul Regan
Chair
people who invest in the community share
offer but do not fit into one of the other two
categories. The board is elected from and by
our membership; any member can stand for
election. The board is legally responsible for
London CLT, much like the directors of a normal
company. However, the board members are
not paid for their work and may only receive
expenses.5
Paul is one of the original founders of the CLT and has worked tirelessly to
make it happen, as our Chair and through his role as a trustee of Citizens
UK, which he previously chaired. Paul is a former Chief Executive of multiple
East London charities. His roles have included CEO of Aston Charities (which
he merged with Mansfield University Settlement to create Aston-Mansfield in
2000), Director of Newham Community Renewal Programme, the Founder
and a former trustee of Conflict and Change, the first Community Mediation
agency in the UK, and Founder and former chair of Landmark Training, which
subsequently became Skills for Growth, combining all of these with his vocation
as a Methodist minister.
Alison Gelder
Secretary
Min Lau
Treasurer
Colin Glen
Vice Chair
Assan Ali
Assan started and sustains a local youth charity, Mile End Community Project.
Besides his local contacts and knowledge, Assan excels at engaging young
people on the issues that matter to them through film and media.
Emran
Mohammed
Miah
Emran is a health trainer at the Bromley by Bow Centre, who also has a
background in retail banking. As a community development practitioner who
grew up locally, he has a wealth of local knowledge.
Janet
Emmanuel
Janet is the Deputy Head Teacher at Sydenham Girls Secondary School. She is
also a member of St William of York Church, one of the organisations leading
the work to deliver a CLT with us in Lewisham.
John Hayward
Notionally retired, Paul brings expertise in not for profit management and
governance, as well as a wealth of East London connections. Paul is a former
trustee of London Catalyst, a London grant making trust. Other current board
positions are as Chair of Applecart, an arts and storytelling charity and trustee
of Aston-Mansfield and Aston-Mansfield Charitable Trust.
Matthew Bolton
Alison is the Chief Executive of Housing Justice, a national Christian
campaigning and service delivery charity working on issues of housing and
homelessness. She brings an in-depth knowledge of the housing sector and
housing need. Alison has 25 years of experience leading organisations in the
private sector, particularly with BT, and the voluntary sector. She is a member
of the Management Board of the Marylebone Project, a former trustee of Bible
Society, and Treasurer of the Rockingham Community Association.
Hasan
Mueenuddin
Min is a Chartered Accountant and is London CLT’s Treasurer. She has held
senior financial positions at a range of companies such as SPX Corporation
and Expedia, and most recently as financial director at Paramount Pictures.
She has experience of business partnering, international finance leadership,
change management, and the management of joint ventures, mergers and
acquisitions and restructuring.
Suzanne
Gorman
Colin is a construction professional used to working on large projects as
a project engineer at Skanska. He is currently supervising the work to the
chimneys on Battersea Power Station. He is a Member of the Chartered
Institute of Building and a Member of the Institute of Civil Engineering
Surveyors. He has also supported a number of community organisations in East
London with their development projects.
Tim Oliver
Cate Tuitt
16
Cate has a legal background as a legal adviser and is now self-employed.
She retains a strong interest in civil rights law. Cate has a long involvement
in housing issues from her time as a board member at Circle 33 Housing
Association and her work as a councillor on the housing committee of Tower
Hamlets Council. She is a Trustee of Tower Hamlets Law Centre and a member
of the Co-operative Party, where she is vice-chair for London.
5
Dave Smith is the former Director of East London CLT, where he played a
pivotal role in securing St Clements. He is now the External Affairs Manager
for London at the National Housing Federation. He has a strong knowledge of
housing, development and urban policy and how to practically communicate
and influence these issues.
John is the Executive Secretary at the British Society of Gastroenterology.
He has particular experience and interest in membership organisations,
having held specialist roles in this field for the Magistrates Association and the
Urban Land Institute. This also gives him a valuable perspective on member
communications, governance, operations and fund raising.
Matthew is the Deputy Director of Citizens UK, bringing deep experience
in community organising and campaigning. He has trained thousands of
community leaders across the UK in how to organise and leads Citizens UK’s
activities in London.
Hasan is a freelance business and management consultant. He has
experience in fundraising as well as youth training & development, careers
guidance, business consultancy, project management and experience
in large capital development projects. Hasan is the Hon. Director of Darul
Ummah-The House of the Community, a multipurpose community centre,
mosque, and independent boys’ secondary school based in Tower Hamlets.
He brings strong business and community connections, and was recently the
London Region Fundraising Manager for an international NGO.
Suzanne is a graphic designer and long-time Tower Hamlets resident who
knows the challenges of trying to find suitable family housing in the borough.
She believes that the built environment can have a huge impact on people’s
wellbeing. Suzanne is active in the local community, as a trustee of the East
London Community Band, and a school governor.
Tim is a health expert, Professor Emeritus at Queen Mary University and an
Honorary Consultant to Barts and The London NHS Trust. Besides housing, his
charitable interests are in sports medicine and community wellbeing through
fitness, not least pop-up urban golf!
Board members may invest in the CLT on the same basis as all other members. This is the first community share offer in London CLT; no interest-bearing
shares have been issued and so no board members currently hold any shares beyond the £1 membership share.
17
OUR TEAM AND OUR PARTNERS
KEY OPERATIONAL TEAM
Calum Green
Communities
Director
Andy Schofield
Housing Director
Catherine
Pearson
Project
Manager
Hannah
Emery-Wright
Membership
& Stewardship
Manager
KEY PARTNERS
Calum is Communities & Campaigns Director at London CLT, leads Citizens UK’s
housing work and is the local Community Organiser for Peckham Citizens. He
brings experience in community organising, campaigning, housing policy,
community-led design processes and architectural and urban design. He has
trained hundreds of community leaders across the UK in how to organise and
continues to guest lecture at a number of academic institutions in the UK.
London CLT has built some key partnerships to help deliver
its vision of homes that are affordable now, and affordable
forever. Our partners bring the key resources we need to grow
our work across London: access to land for building our homes;
capital finance for construction; political support; systems &
processes; and people with the skills, know-how, and networks
to support our vision.
Calum was previously an East London CLT member of staff during the St
Clements campaign, before becoming a board member, where he helped
co-ordinate the Shuffle Festival on the site at St Clements.
Our current key partners are:
Andy’s background combines urban regeneration and social enterprise. He
is an experienced business manager, co-founder and Director of Cocreate, a
consultancy co-operative focused on sustainability and social enterprise, and
developer of the Transformational Index, a bespoke tool to measure social
impact. Previously he was the director of special projects at Pinnacle psg,
looking at quality of life issues for residents of social housing. He holds a Masters
degree in development and planning from UCL.
Catherine is an experienced freelance project manager with a background
in the public sector. She is working with London CLT to help establish and
implement our housing policy and other new systems. She previously worked
as a senior manager for the Marylebone Project, a women’s homelessness
charity, and has experience of linking housing and employment, including
through her work with Hackney Homes.
• Greater London Authority
• JTP
• Citizens UK
• Peabody Homes
• Galliford Try
• National CLT Network
• Linden Homes
• Champlain Housing Trust
• London Borough of Tower Hamlets
• Lewisham Citizens
• London Borough of Lewisham
• K&L Gates
• Resonance
• CAF Bank
• Shuffle
Hannah is joining the London CLT team as the membership and stewardship
manager, with a particular focus on caring for our members and incoming
residents at St Clements, as well as expanding and improving our services
to members and residents. She is passionate about pursuing more cohesive
communities with equal rights and opportunities for all. Her previous
experience includes international development overseas and social
enterprise work in London.
OUR ADVISORS
Kate Gould
Legal co-optee
Stephen Hill
Retained
advisor/
consultant
18
As a property lawyer, Kate has an expert client role for the CLT when dealing
with external lawyers. She provides additional scrutiny on legal documents
and supports our negotiations with partners. Kate also helps with company
secretarial duties, including improving our constitution.
Stephen is a long-term advocate and champion of CLTs. He directs his own
strategic planning and development practice, advising public bodies and
community housing initiatives on a range of strategic issues. Stephen is a board
member of the National CLT Network and National Association of Self Builders.
He is also an active member of the Royal Institute of Chartered Surveyors and
was recently awarded a Churchill Fellowship for work on CLTs in the US and UK.
19
THE SOCIAL CASE
In London, the case for housing that people can actually afford is rarely out
of the headlines. The current generation of Londoners is facing house prices
that are, depending on which part of London you’re in, somewhere between 7
and 31 times average incomes. And since banks will typically lend 4 times your
income, it’s already impossible to get started without a very significant deposit.
No wonder this generation has been called ‘generation rent’ This is not ok.
It’s what drove us to create a model of social impact to fix it.
We used a process called the Transformational Index to distil what really matters
to us when it comes to homes, families and communities and, crucially, how
we’ll know what success looks like when we see it.
The Transformational Index is a tool that helps organizations to quickly
identify their intended social impact and to measure progress in a way
which balances a commitment to values with a focus on results. It has
been used with over 150 social enterprises, social investors, charities and
foundations to describe and measure the social impact of their work.
The diagram to the right is what we developed to describe our model
of impact. For us, these words have a deep meaning for how we work
and what we seek to achieve:
Creativity means we
approach the issue of
affordable housing in new and
different ways – from concept
to completion
Mutuality means London CLT
operates with and on behalf
of its members – this is not
merely a structural reality, but
the core of its ethos
Leverage is part of the ‘magic’
of London CLT: its ability
to leverage existing and
surprising resources to achieve
its aims
Integrity means the values
and aims of London CLT give
it a strong identity, which
makes it stand out in a housing
sector that fluctuates widely
depending on the market
Investment means we
make possible permanently
affordable housing through
obtaining financial investment,
sustained effort and
capable people
Entrustment means we enable
people to secure their own
housing and to become
agents of change in their
community
We are working out how to measure these things by collecting data for a social
impact dashboard, so that all of our members can see how we’re doing against
our social mission. It means we are accountable to our members in the only
way that matters: the extent to which we’re making maximum difference to
Londoner’s lives through housing.
Including the 23 homes at St Clements, we have identified opportunities with
the potential to deliver 184 homes from 2016-17 onwards. The projections from
our model show that these 184 homes could, at full occupancy, be where 727
Londoners call home: people that your investment will support. Over time, as
families change, move on and move out, the same houses should always be
there to help new families find a home they can afford. So, over time, your
investment is likely to support many more people than the 727 first-timers.
20
A brief introduction to CLTs
A Community Land Trust is a not-for-profit,
democratically-controlled, community-based
organization, typically run by skilled volunteers, that
aims to develop permanently affordable housing,
and look after other assets for long term community
benefit.6
Eligibility is determined with regard to local incomes
and local house prices, so CLTs often work best
where the gap between household incomes and
house prices is at its widest, like London.
Priority is always given to local people and families.
Communities are consulted first on what they
need and want in their area, humanizing the
development process.
The key to CLTs is the price and control of land
(hence the name Community Land Trust): so instead
of buying land at the going rate, CLTs work out
how much they can afford to pay for the land on
which to build homes, in order to make sure they’re
affordable. Landowners who share CLT values tend
to buy into the model because they can see that
the CLT is paying a reasonable price based on
what it can afford, and passing on the saving as
affordability for future generations.
A brief introduction to Community
Benefit Societies
Although CLTs can take different organizational
forms, London CLT is a community benefit
society. This is a not for profit corporate
body based on membership. The society is
democratically controlled by its members, who
have limited liability.
Community benefit societies are run for an
explicit community benefit. They have a legal
duty to plough back any proceeds into their
mission, in line with the objects of the society.
Due to their non-profit nature, a community
benefit society’s assets must be transferred to
another body with a similar purpose on winding
up. This is different to co-operatives, which may
distribute assets amongst their members.
Community Benefit Societies are regulated
(but not authorised) by the FCA under the Cooperative and Community Benefit Societies Act
2014.
6
The statutory definition is in Part 2, Section 79 of the
Housing & Regeneration Act, 2008.
21
2017/18
2018/19
2019/20
2020/21
2021/22
2022/23
2023/24
2024/25
2025/26
+£4.219m
+£1.857m
+£5.825m
+£7.016m
+£3.455m
+£4.396m
+£5.380m
-
-
-
Anticipated Expenditure
-£3.645m
-£1.828m
-£4.896m
-£5.960m
-£2.937m
-£3.736m
-£4.573m
-
-
-
Operating Costs
-£0.158m
-£0.171m
-£0.214m
-£0.223m
-£0.223m
-£0.226m
-£0.223m
-£0.223m
-£0.226m
-£0.226m
Financing
+£0.010m
-£0.067m
-£0.026m
-£0.021m
-£0.018m
-£0.015m
-£0.011m
-£0.008m
-£0.005m
-£0.002m
Surplus (-Deficit)
+£0.426m
-£0.209m
+£0.689m
+£0.812m
+£0.277m
+£0.419m
+£0.573m
-£0.231m
-£0.231m
-£0.228m
Homes Delivered
23
10
36
40
19
25
31
-
-
-
Photo: Jess Sutton for Shuffle Festival
2016/17
Projected Income
Financial Year
THE BUSINESS CASE
The Homes We Want to Deliver
Projected Income
Surplus/Deficit
The table above is extracted from figures
prepared by London CLT. It illustrates the
schemes that are either under way or in the
pipeline over the ten years through to 31st
March 2026. We expect several more schemes
to come forward over the ten year horizon
of this projection, but we can, of course, only
include the ones we can see at the moment.
The projected income in our financial model is
based on a signed contract with Galliford Try for
the delivery of 23 homes (under construction)
at St Clements Hospital on Mile End Road in
London; a public commitment from the London
Borough of Lewisham to work with us on a CLT,
anticipated to provide 12 homes in 2017-18; and
a commitment from the Mayor of London for 100
CLT homes on the Olympic Park at Sweetwater
and at East Wick over 5 years from 2017-18. The
others, based on a mixture of public political
commitments and procurement processes, are at
an early viability stage.
Staff costs in 2016 and 2017 are lower because
grant income from the Oak Foundation to
Citizens UK is covering the costs of our seconded
Communities Director.
Cost recovery from the St Clements development
is expected to be realized in the second half of
2016-17 and will make a significant contribution to
developing new sites. It is not, however, sufficient
on its own to allow us to pursue the opportunities
we can see. For example, the Lewisham scheme
is expected to cost c. £130,000 to get through the
process of securing the land, planning, contracts
and finance; ready to begin building and then
eventually generate cost recovery of c. £112,000
(net, after deducting the c. £130,000 and the
build cost) when the homes are sold in 2018-19.
This also explains the deficit in 2017/18: the costs
of construction at Lewisham are mostly in this
year, whereas the income is in 2018/19. Other sites
will vary depending on the deal we manage to
achieve with local authorities and/or developers,
which is why we need some additional
investment in the short to medium term to allow
us to pursue these opportunities. It takes time
to develop homes in London and that means it
takes time to generate enough surplus to pursue
all the schemes we can see.
Anticipated Expenditure
Number of Homes Delivered
The contracted cost-recovery (of c. £0.6m) from
St Clements allows us to plan the growth of the
CLT to make the most of the opportunities we
can see over the next ten years. It means we can
recruit additional staff to pursue opportunities
and scale the business, at the same time as being
able to make interest payments to our community
shareholders and any other investors. Building
the staff team to 2.2, and then to 3.6, full-timeequivalent personnel, renting some value office
space, and improving our IT and management
information systems are the main costs of the
business as we grow. We have careful control of
our pre-development and development costs
through tendering for projects and verification by
external consultants including RICS accredited
Quantity Surveyors.
During the ten years covered by our projections,
we will have signed contracts and/or public
commitments for 184 homes, across seven sites,
which we want to bring forward during the
period. Not all of those will necessarily become
reality, but there should also be others we can’t
yet see that might. Our ambition and intent is to
exceed these numbers and add more homes to
our pipeline over the next 10 years.
The projected income figures in the table
above are from sales of the affordable homes
from our own schemes like St Clements. They
do not include development agency fees and
consultancy fees where we hope to support other
CLTs to deliver their own projects, which would
give us additional income.
We are a Community Benefit Society, so
generating a surplus is not an end in itself; it is for
investing in creating more and more affordable
CLT homes in London.
The anticipated expenditure figures in the table
are primarily the costs of acquiring the homes
financed and built by our developer partners,
before we sell them to our incoming families.
The purchase and sale should typically happen
on the same day, which keeps our financial
risk under control. Where we build the homes
ourselves, as we intend at Lewisham for example,
we need to borrow the money, commission
the homes, and then sell them to our incoming
families. However, the financial risk is greater in
these circumstances because we will need to
borrow the money up front. Most of the homes we
anticipate providing will be through developer
partners, controlling our financial risk. Full details
are available by requesting our full site-by-site
financial model.
22
Our income projections are primarily based on
sale prices to prospective householders linked to
local median incomes, which gives us confidence
in the achievability of our income.
Source and Application of Funds
The estimated cost of operating London CLT
is currently c. £160,000 per annum and we
know that acquiring and preparing the site in
Lewisham including site surveys and getting
planning permission is expected to cost
£130,000. The development itself will cost in
total c. £1.8m and take around two years, with
the construction finance sourced from banks
and other investors who share our mission.
Therefore, this share offer is intended to assist
London CLT for approximately the two years of
preparation, construction and sale of the homes
in Lewisham. The secured surplus from St Clements
will, in the meantime, allow us to pursue other
opportunities in the pipeline and pay returns to
community shareholders and other investors. In
total, therefore, the investment we are seeking
is £450,000 (approximately two years’ operating
costs, plus Lewisham pre-development costs of c.
£130,000). Construction finance for the sites where
we commission the development ourselves will be
sourced separately.
23
Stewarding Your Money
We are conscious that things don’t always
go precisely to plan when you’re running an
organization, so we want to be careful with
looking after your investment, just in case. We
have modelled our finances on the basis that
we should always have approximately the same
amount available to the organization as we have
raised from shareholders as a minimum. What that
means is that the Directors will aim to keep the
level of assets in the organization under review so
that there should be sufficient resources to return
investment to our shareholders if things don’t go
the way we expect.
In practical financial terms, if we reach our target,
this means that once the £450,000 investment
has been spent pursuing the Lewisham site and
other opportunities over the two years in our plan,
we will have to spend some of the £635,000 we
should then have received from the St Clements
scheme. If we still have not successfully delivered
any affordable homes, and the remaining level
of resources is reduced to £450,000 (the level of
our shareholders’ investment), we will review our
position at Board level, based on our prospects
of securing assets in the near term and thus
ensuring that members’ funds are safeguarded.
This is a fallback position and should be relatively
unlikely, since it would mean that we had failed
to develop any sites over two to three years,
well behind our plan. However, it is there as a
safeguard because we want to use your money
wisely.
enough to do both. Our preferred option would
be bringing forward the Lewisham opportunity but
if that proved unviable for any reason, we would
want to spend time and resources elsewhere to
deliver more affordable homes.
In the event that that we do not reach the
minimum target, we will not proceed with
the community share offer. No shares will be
allocated and any money committed by our
investors will be returned. Ethex, our partners, will
hold all money in a segregated escrow7 account
for the share offer period to protect our investors.
During this time, London CLT will not have access
to the funds. If we reach our minimum target or
above, the share offer will close; the funds will be
transferred to London CLT and share certificates
issued to our investors. If not, investors’ money will
be returned in full as soon as we can process the
refunds.
If the share offer is over-subscribed, we will
prioritise investment from individuals and
organisations in London. We will then allocate
shares in a way that enables us to gain as many
Members of London CLT as possible, so that
we can best reflect the values we hold as an
organisation that is by, for, and with, Londoners
(please see The Social Case described in this
document).
The minimum target of £150,000 for the
community share offer is set at a level to allow
us to still pursue something valuable, but at that
minimum level it is likely to become an either/
or choice. Either it should be sufficient to bring
forward the opportunity at Lewisham; or sufficient
to cover our operating costs for a year in pursuit
of other sites such as the Olympic Park; but not
7 An escrow is an arrangement where a third party acts as the custodian of
funds until the conditions for releasing them are met; for the protection of
those involved in the transaction.
24
P
to
ho
s:
Je
ss
S
on
utt
for
Sh
e
uffl
Fe
sti
va
l
25
RISK FACTORS
Risk
London CLT is currently operating successfully. However, it
is important to recognize that circumstances can change.
Whilst the CLT intends to be cautious and prudent with regard
to its liabilities, you should give careful consideration to all
the information provided in this offer document and the risks
attached to any investment, as these risks could result in a
fall in the value of that investment, or a loss of return, or both.
The following are not the only risks; the list is not intended to
include everything (and could not do so, especially because of
unforeseen risks), and other matters can influence the value of
your investment.
The Directors consider the following to be the key risks to London
CLT and have given each risk a grade out of 5 for potential
impact and a grade out of 5 for potential likelihood. The two
grades are multiplied together to give a total risk score, which
helps identify the key risks and focuses attention on mitigating
those risks. The risks are presented here in order of score:
CA
MP
AI
GN
IN
G
FO
RH
OM
ES
OU
TSI
DE
CI
TY
HA
LL
8
Impact
Score
Identify sufficient sites and
properties suitable for
affordable homes.
3
6
Mitigation
There is a significant pipeline of schemes. However, London
CLT will actively market itself across key communities in London
with the assistance of its key partners.
Obtain pre-development
finance to scope potential
projects prior to receiving
planning permission.
3
6
London CLT and local Community Land Trusts (CLTs) will
maximise the use of the CLT Fund8 and any other appropriate
funding for this purpose. Other streams of funding will also be
explored, including resources from partners where they are
involved.
Retain a professional staff
team who are motivated to
achieve the objectives of
London CLT.
3
3
London CLT provides competitive pay and conditions of
service alongside a very strong social purpose that attracts
and motivates talented people. Staff have regular review
meetings with the Board of Directors to ensure that training,
resources and support are available to reinforce this.
Raise sufficient investment
through a community share
offer
3
3
Individuals investing in UK community share offers bought an
average of c. £2,000 worth of shares each last year. London
CLT has over 1500 members and the share offer will be
marketed beyond them, to attract new members, including
through Ethex, which has 4,000 active investors using their
site as a well as a larger mailing list. Whilst not all London CLT
members will be in a position to invest, the combination of
these two sources suggest that the full amount is achievable.
The lower limit of £150,000 acts as a contingency – this would
secure London CLT’s current position and should be sufficient
to bring forward the Lewisham site without additional finance.
Obtain development/
working capital to build
schemes once planning
permission has been
achieved.
2
2
Construction finance will be sought from social investors with
whom London CLT has a successful track record. Turn-key
solutions will continue to form a significant proportion of homes
delivered, minimizing the exposure of the CLT to finance risk.
If for any reason sales do
not take place as planned,
having alternative plans in
place to use the homes.
2
2
Managing demand is likely to be the main challenge. In the
event that a household’s circumstances change, we will
approach the next suitable household on our list. Underwriting
finance has already been agreed in principle for our first site
and this is likely to be available for future developments. We
have also discussed with the lender the potential of using the
underwriting finance as a long-term loan for any homes we
don’t sell.
Retain a broadly based
group of Directors
dedicated to the continued
success of London CLT
2
2
Review skills and aspirations on a regular basis (as is required
annually by our rules) and ensure that induction, development
and succession processes are in place to match the skills,
connections and representative mix of the Board to the
mission of London CLT.
Disposal of properties to
people who meet the local
connection requirements
for affordable homes.
1
1
Early engagement with local communities and assistance from
London Boroughs plus the extreme excess of demand over
supply will mitigate this risk.
Reassurance to London
Boroughs, GLA, and local
landowners that homes
will be affordable and that
if re-sales take place any
capital receipts will be
re-cycled within London
Boroughs.
1
1
London CLT can point to its own track record and that of other
CLTs in retaining control in perpetuity. Resale covenants have
proven a very effective way of ensuring that homes remain
affordable for local people in perpetuity. A clear agreement
with London Boroughs on how any capital receipts would be
used and recycled in the event of different circumstances will
be developed.
A specialist fund offering grants and loans to CLTs to encourage their development
27
These business risks could potentially impact on London CLT’s
ability to repay share capital or pay annual interest due to a fall
in turnover and levels of surplus.
Please note:
• Shares in London CLT cannot be sold,
exchanged or transferred (except on
death or bankruptcy) or traded on any
Stock Exchange and there is no likelihood
that they will increase in worth beyond
their nominal value.
• After a fixed period of three years from
the closure of the share issue, shares are
withdrawable on 6 months notice. London
CLT will not pay you back more than you
originally paid for your shares.
• Although shares are withdrawable, you
may not be able to withdraw your shares if
London CLT does not have sufficient funds
available at the time you wish to withdraw
them or if the Directors have otherwise
suspended the right to withdraw at that
time.
28
• The value of your shares may fall. They will
not increase in value.
• If London CLT made significant financial
losses the Directors may need to write down
the value of shares.
• Should you then wish to withdraw your
shares, you will receive only the written
down value of those shares.
• As a Community Benefit Society, London
CLT is registered with but not authorised by
the Financial Conduct Authority. Members
are not protected by any right of recourse
to an ombudsman, any financial services
compensation scheme or any deposit
guarantee scheme.
29
YOUR INVESTMENT
return of 5%.
Who can invest?
You are invited to invest in London Community Land Trust to help
us develop permanently affordable homes for local families in
one of the most expensive cities in the world.
Individuals over the age of 16, charities, trust funds, Self-Invested
Personal Pension Plans, nominee services and corporate entities,
groups and associations, and other organisations may invest in
this offer. You can also buy and hold shares on behalf of a child.
Share offer timetable
Offer period commences:
19th February 2016
How much can you invest?
Offer period ends: 19th April 2016
(unless closed early or extended)
We are offering £1 shares, with a minimum investment of £100
and maximum investment of £100,000; seeking to raise £450,000.
If you would like to invest more than £100,000 in London CLT,
please contact our corporate advisers, Resonance Limited.
Contact details can be found at the end of this offer document.
Shares allotted:By 31st May 2016
(unless closed early or extended)
Share type
How to invest
We are offering ‘withdrawable’ shares that cannot be sold,
traded or transferred between Members, unlike the ‘transferable’
shares typical of a limited company, and only London CLT can
buy them back. London CLT is a Community Benefit Society
under the Co-operative and Community Benefit Societies Act
2014 (Registered Number 30238R).
Ethex is managing the administration of this share offer for us. It
is a not-for-profit positive investment web platform, which makes
positive investing easy to understand and easy to do. You can
either:
• Invest online at
www.londonclt.org/get-involved/community-share-offer
There are two classes of share: ‘A’ class membership shares are
one member, one vote shares that cost one pound. All current
members have one of these. They do not carry a right to any
dividend. New members will also have to buy one of these
shares. This will be the first pound of any investment.
This will take you through to the Ethex website where our
share offer is listed. Our preferred method for investing is
online – it’s paperless and efficient.
If you have any problems, or if you need help, please call
Ethex on 01865 403304.
Existing members and those that would like to participate in the
community share offer have the option of purchasing ‘B’ class
withdrawable shares. These can only be purchased by members
(i.e. you must have an A class share) and they do not have any
voting rights. However, they carry the potential of an anticipated
A
Type:Type:
A
Membership
(Compulsory)
Membership
(Compulsory)
VOTE
One One
One
membermembervote
£1
£1 Members
one
for £1
Members
can buy can
one buy
share
forshare
£1
30
B
Type:Type:
B
Withdrawable
(Optional)
Withdrawable
(Optional)
A
VOTE
OneNo interest
No interest
vote
• Or, if you would prefer, you can send a cheque with the
paper application to Ethex and they will process your
investment. (Please see the application form at the end of
this document for more details.)
A
VOTE
only
AvailableAvailable
only
No
type A members
to type Atomembers
vote
£100+
If you would like to hold shares on behalf of children or
nominate a person to whom you wish your shares to be
transferred on your death there is an additional form for this
purpose at the end of this document. Unfortunately we do not
have the facilities to accept this form online. Please complete a
VOTE
No Up to
Up to
vote5% interest
5% interest
MembersMembers
can buy can buy
£100+
£100 – £100,000
£100 – £100,000
worth of worth
sharesof shares
31
paper form and return to Ethex.
reshape in future versions.
projects rather than receive interest payments.
and interest earned on the shares.
The benefits of investing
Withdrawing capital
Investors become Members of London
Community Land Trust and become part of the
groundswell of support for creating communityled housing that truly meets the needs of
people in London. Members will have a say in
the running of the Community Benefit Society,
and are entitled to a share of any profits on
capital invested (distributed in the form of
interest payments) when there are sufficient
funds available.
Although shares are withdrawable, this is
subject to six months’ notice and is at the
discretion of the Directors, especially if
there should be insufficient funds to make
repayments. The Directors have decided
that no monies can be withdrawn for the first
three years to give the growing business some
resilience and stability. We strongly encourage
investors to view their investment as being a
long-term commitment to London CLT. You
should look at it as a long-term investment
which may generate some financial benefits to
you, and sustained social benefit to families in
London.
Provision is made in our Rules to pay interest
on share capital at such rates as may be
determined by the Directors from time to time.
Can we hold shares
in joint names?
We anticipate that you will experience the
following benefits:
1.Being able to pay members a target interest
rate of 5% on the value of their B class
shares each year from 1st April 2017
2.Repayment of your initial investment,
available from year 4 with the aim of
repaying all investors in full by 2025/26.
3.A vote at General Meetings: all Members
are entitled to one vote, regardless of how
many shares they hold
4.The right to attend General Meetings at
which Board members are elected
5.The right to stand for election to the Board
6.Being informed of our progress by our
members newsletter, being consulted
on key decisions, being involved in
campaigning for new sites and being
invited with all members to our Annual
General Meeting. Members can choose
how actively they wish to participate
Please note that investing in London CLT’s
community share offer does not guarantee or
improve a person’s chances of being housed
in one of the homes we develop. London CLT
homes are allocated according to a needsbased Housing Allocations Policy which, as a
member, you can view and may help renew or
Returning capital
As stated in the summary of benefits above, we
anticipate that capital will start to be returned
to investors from year 4, with a number of
shares being bought back gradually over time,
with the aim that all shares are bought back by
2025/26. However this is not guaranteed and
the decision to return capital will be made by
the Directors. Members of London CLT will be
consulted at the time.
How might my investment work
in practice?
For approximately the first year after we close
this share offer, we do not expect to pay any
interest on your shares, nor return any of your
capital as we deploy the finance to grow the
business. From year 2, we anticipate paying
interest on shareholdings and, from year 4,
anticipate beginning to return shareholders’
capital.
Interest will accrue from 1st April 2017 for all
shares issued by that date. The anticipated rate
of interest will be notified to investors during
December each year for the forthcoming
financial year. Members may also be offered
the opportunity to reinvest their returns in future
London CLT anticipates paying interest gross to
investors, unless required to do otherwise by HM
Revenue and Customs. Investors should report
the gross income to HMRC in their annual
tax return. Even if your investment through
B class shares has been fully withdrawn, you
will continue to be a Member of London
CLT through your payment of the £1 share,
although you can leave if you wish by notifying
the company secretary. Please note that if you
have not previously registered as a member
of London CLT, you are required to hold one of
these shares and London CLT will deduct one
pound (£1) from your investment, in line with
our Rules.
Can I hold shares on behalf of
children?
Members must be at least 16 years of age. You
have the option of holding shares on behalf
of someone who is under 16. There is a form
for this purpose at the end of this document.
Following that person’s sixteenth birthday they
may become a Member of London CLT and
those shares can be passed on to them.
If you would like to hold shares on behalf
of children or nominate a person to whom
you wish your shares to be transferred on
your death there is an additional form for
this purpose at the end of this document9.
Unfortunately we do not have the facilities to
accept this form online. Please complete a
paper form and return to Ethex.
Charges & running costs
There are no charges made on your
investment, but the costs of attracting more
finance to grow the business and the costs
of running London CLT will be paid for by the
business and will be taken into account when
determining the annual interest rate to be paid
to members.
Board members will not take a salary but will be
reimbursed for reasonable expenses.
Other costs that apply are likely to include:
• Our corporate advisers will receive a fee
related to the success of this share offer of
approximately 3% plus VAT of capital raised.
• Advertising and direct promotional costs
are anticipated to be in the region of £2,500
plus VAT for the current share offer, paid by
London CLT. The costs of administering the
share offer and issuing share certificates is
anticipated to be £7,250 plus VAT.
• Legal costs are anticipated to be in the
region of £1,500 plus VAT for the current
share offer, paid by London CLT.
In total, if we raise our target, we
anticipate these costs together amounting
to approximately 5.5% of the total amount
we raise.
You should obtain your own accountant’s
advice on tax treatment of any gift of shares
9
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Unfortunately not. Shares cannot be held
jointly.
In the event of the death of a shareholder, the repaid value of the shares will
normally be added to the estate for probate purposes. For investments up to
£5,000 you may elect to nominate a recipient for the value of the shares and
thus (under current legislation) remove the value of the shares (up to £5,000)
from your estate for probate (but not tax) purposes.
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TERMS AND CONDITIONS FOR
APPLYING FOR SHARES
Your application
Dissolution, demutualization, or winding-up
The Board do not have to accept your application for shares.
They may decide not to issue shares to you or may issue you
with fewer shares than you had asked for. They do not need to
give a reason for their decision. If membership is approved, a
share certificate will be issued within 30 days of the closure of
the share offer.
In the case of the solvent dissolution or winding up of London
CLT, holders of shares will have no financial entitlement beyond
payment of outstanding interest and repayment of paid-up
share capital, subject to approval by the Board. Any remaining
funds must be given or transferred to such charity or community
benefit society as we may nominate from time to time.
Your payment
Cancellation of offer
Shares are payable in full on application. We will inform you
once your application and payment have been received. The
Board may cash your cheque as soon as it is received. Cash
payments cannot be received. London CLT will hold your funds
on trust for you until the Board considers your application.
If you wish to cancel your application you should write to us
within 14 days of submission of the application. You cannot
withdraw your application once this time period has elapsed.
The Board will return your money, or the balance if you are
allocated fewer shares than you applied for, within 28 days of
the Board meeting at which they make their decision.
The Board, whose details can be found in this document under
the heading Our Team and Our Partners, accept responsibility
for the information contained in this Offer document. They have
taken all reasonable care in producing this document and,
to the best of their knowledge, have not withheld any facts
essential to its understanding.
If your application is declined or if no shares are issued, for
instance if the minimum is not reached, then your money will be
returned when the refund can be processed.
Your promises to us:
• You are at least 16 years of age.
• Your cheque or payment will be honoured on presentation.
Board declaration
This offer document was approved by the Board of London CLT
on 20th January 2016.
The share offer represented by this document expires on 30th
April 2016 unless extended by the Board of London CLT.
• You have authority to sign the application form.
• You will supply us with proof of your identity and address
if we ask for it. We may need this to comply with current
Money Laundering Regulations.
• You are resident in the United Kingdom.
• You are not relying on any information or representation
which is not included in this document.
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35
OTHER LEGAL STUFF
WE NEED TO TELL YOU
Anyone interested in making an application
for shares in London Community Land Trust
Ltd is strongly advised to take appropriate
independent advice. The list of risks
contained in this document is not necessarily
comprehensive. Shares in the Society are not
‘investments’ for the purposes of the Financial
Services Marking Act 2000 (FSMA), therefore
you do not have the level of protection that
you might otherwise be offered by that Act
or subsidiary regulations. In particular, this
document does not need approval (and has
not been reviewed, authorised or otherwise
approved) by an ‘authorised person’ under
section 21 of FSMA or by any regulatory body.
As a community benefit society, London
Community Land Trust Ltd is registered with, but
not authorised or regulated by, the Financial
Conduct Authority and therefore any money
you pay for shares is not safeguarded by any
depositor protection or dispute resolution
scheme. In particular, you will have no right
of complaint to the Financial Ombudsman
Service nor any access or entitlement to the
Financial Services Compensation Scheme.
London CLT Ltd was registered with the
Financial Services Authority (the predecessor
regulator to the Financial Conduct Authority)
on 23rd May 2007 (Registered Number 30238R).
Our governing document, the Rules of London
CLT Ltd, is available to download at www.
londonclt.org and explains Member rights as
well as the management and constitution of
the Society.
If London CLT Ltd is wound up, its assets will be
first used to meet its liabilities; next to repay
Members for their shares; and finally any surplus
remaining will be passed on to a charity,
society or other body with similar objectives.
36
The Board of London CLT Ltd have taken all
reasonable steps to ensure that the facts
stated in this document are clear, fair and
not misleading in all material aspects, and
that there are no other material facts, the
omission of which would make misleading
any statement in this document. To the extent
permitted by relevant law and regulation,
the Board and London CLT Ltd expressly
disclaim and exclude any and all liability
based on this document and for any errors
or omissions contained in it. No person has
been authorised to give any information or
make any representation other than those
contained in this document and, if given or
made, such information or representations
must not be relied upon as having been so
authorised. All statements of opinion contained
in this document, all views expressed and all
projections, forecasts or statements relating to
expectations regarding future events or the
possible future performance of London CLT Ltd
represent the assessment of the Board based
on information available to them as at the
date of this document but are not to be read
as guarantees or assurances that the particular
events will in fact come about. Accordingly, no
representation is made or warranty given as to
the accuracy, completeness, achievability or
reasonableness of any such projections, views,
statements or forecasts.
Can you afford to be without the money you
would pay for these shares? If not, PLEASE do
not buy any shares.
As with any
investment, there is risk
involved. Should London CLT Ltd
get into financial difficulties:
• We may not be in a position to pay
interest
• We may have to suspend your rights
to withdraw shares
• You may lose all the money you pay
for your shares
About Ethex
Ethex is a positive investment and savings platform that makes
it easy to make money do good. On the platform, you can
browse, compare and invest in a range of products from bank
accounts and ISAs to equity investments and charity bonds
that offer a social and environmental as well as a financial
return. Since 2013, Ethex has helped raise over £28 million of
investment into 53+ social businesses, charities and community
organisations.
Ethex is the Receiving Agent for London CLT’s share offer, which
means that investors wishing to make an investment in London
CLT will do so via the Ethex website, www.ethex.org.uk
Ethex is registered with HM Revenue and Customs for Money
Laundering Regulation. This is in order that it can receive money
from investors and pass it on to the businesses invested in. All
monies received from investors are held in a segregated client
account, so that they are separated from Ethex’s own funds.
All Ethex directors have undertaken a ‘fit and proper test’, as
part of the HMRC registration process. Ethex is not required to
be authorised by the Financial Conduct Authority in so far as it
provides information on or arranges deals in investments. This
is because it is an Enterprise Scheme, which is exempt from
regulation in arranging financial deals when not for pecuniary
gain as specified in the Financial Services and Markets Act 2000
(Exemption) Order 2001, paragraph 40.
37
APPLICATION FORM FOR PURCHASE OF
SHARES IN LONDON CITIZENS’ CLT LTD
I wish to become a member of London Citizens CLT Limited
in accordance with the Rules and apply for:
Shares to the value of: £________ and enclose a cheque for this amount, made
payable to ‘Ethex Ltd’.
For this offer the minimum shareholding is £100 and the maximum £100,000.
Applications can be received at Ethex, The Old Music Hall, 106–108 Cowley
Road, Oxford OX4 1JE until 30th April 2016.
Name and address (PLEASE USE CAPITAL LETTERS)
First name in full
Last name
Address
Town/city
Postcode
Date of birth
Telephone no.
Email
If you have been living at the above address for less than 3 years please provide
us with your previous address:
Previous address
If you are applying for shares on behalf of an organisation, please supply the
following additional information.
Please note, this form must be signed by a Director of your organisation.
First official company name
Registered company number
Name of signatory
Position in organisation
Agreement
• I have read the Share Offer Document, including risk factors.
• I wish to become a Member of London CLT.
• I agree to be bound by the Terms and Conditions included in the Share
Offer Document and the Rules of London CLT Ltd (see www.londonclt.org).
• I understand that the Board of Directors of London CLT may reject my
application, and are not obliged to tell me why it has been rejected.
• I consent to receiving formal notices by email and links to formal documents
on the London CLT website.
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Signed as a Deed
Signature
Name in print
Date
Please send your completed application form and payment (cheques made
payable to ‘Ethex Investment Club Ltd’) to: Ethex, The Old Music Hall, 106–108
Cowley Road, Oxford, OX4 1JE.
If you wish to nominate a person to whom you wish your shares to be transferred
on your death, please tick the box
and complete the form overleaf.
Data protection and money laundering
The data provided by you on this form will be stored within a computerized
database. This data will be used only for London CLT purposes and will not
be disclosed to any third party. It is a condition of the offer that to ensure
compliance with the Money Laundering Regulations 2003, London CLT may at
its absolute discretion require verification of the identity of any person seeking to
invest.
Notices by email and documents on our website
To reduce our administrative costs, we would like to be able to send you formal
notices by email and refer you (by email) to documents posted on our website.
By signing this form you are consenting to receiving such notices by email and
accessing documents through our website.
If you have any queries about your application, please call Ethex: 01865 403304
You can also apply online via ethex.org.uk/londonclt or via www.londonclt.org
39
HOLDING SHARES ON BEHALF OF CHILDREN
AND NOMINATION OF SHARES ON DEATH
You can choose to:
• Hold shares on behalf of children; and/or
• Nominate a person to whom you wish your shares to be transferred on your death.
Please fill in the relevant sections below.
Holding shares on behalf of children
If you wish to hold shares on behalf of someone who is under 16, please fill in that
person’s details below
First name in full
Last name
Date of birth
Address (if different from that supplied
on application overleaf)
Town/city
Postcode
Nomination of shares on your death
You can nominate a person aged 16 or over to whom you wish your shares to be
transferred on your death.
Trustees will need to be appointed for a nominee under 16 years old.
London CLT will respect your wish in so far as the law and our Rules permit.
Personal details of your nominee
First name in full
Last name
Address
Town/city
Postcode
I understand that it may not be possible for London CLT to action this request
and I and my heirs will not hold the Society responsible for its actions. I understand
that these instructions can only be revoked or amended by my giving clear written
instructions to the Secretary of London CLT at its Registered Office.
I understand that trustees will need to be appointed if my nominee is under 16 years of age.
Signed as a deed
Date
Name in print
Signature of witness
Date
Name in print
Please send your completed form to: Ethex, The Old Music Hall, 106–108 Cowley Road,
Oxford, OX4 1JE.
If you have any queries about your application, please call Ethex: 01865 403304
Invest online at www.londonclt.org
Click the ‘invest now’ button and this will take you through to the
Ethex website where our share offer is listed. Alternatively, you can
fill out the application forms at the end of this document and send
them with a cheque to: Ethex, The Old Music Hall, 106-108 Cowley
Road, Oxford OX4 1JE.
Share offer administration:
Ethex
www.ethex.org.uk
01865 403304
help@ethex.org.uk
Solicitors:
Anthony Collins Solicitors
134 Edmund St, Birmingham B3 2ES
0121 200 3242
Corporate finance advisors:
Resonance
www.resonance.ltd.uk
0345 0043432
info@resonance.ltd.uk
Bankers:
CAF Bank Limited
25 Kings Hill Avenue, Kings Hill, West Malling, Kent ME19 4JQ
03000 123 456
Design by Lindsay Noble Design
Photos by Jess Sutton, London CLT and Citizens UK.
The use of partners’ logos does not represent any endorsement of this share offer.
London Citizens’ CLT Limited is an Industrial and Provident Society for the Benefit
of the Community, registered in England and Wales.
Registration Number 30238R.
Registered address: 112 Cavell Street, Whitechapel, London, E1 2JA.
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