Australian impact investment firm, Brightlight, has launched its second wholesale bond offer in NZ to back six social housing projects.
Brightlight, which established the Te Puna Hapori strategy with Trust Waikato in 2019, is seeking $37 million for the new impact bond following a similar $13.7 million fund-raise earlier this year.
Trust Waikato has previously committed $10 million to the yet-to-be-completed Te Puna Hapori Fund, which will ultimately invest into the underlying bond offers.
Tim Symons, head of Brightlight community infrastructure partnerships in NZ, said the fund should be finalised by the end of this year.
But in the meantime Symons said the Te Puna Hapori Series II bond issue was targeting wholesale investors looking for impact projects – an increasingly popular target for community trusts and the like. For example, Auckland community trust, Foundation North, has recently allocated $20 million to the Te Pae ki te Rangi impact fund.
Generate KiwiSaver backed the first Te Puna Hapori bond issued this March with the $13.7 million used to fund two South Auckland social housing developments.
Round two of the impact bond offer will invest into “a diversified portfolio of six New Zealand community housing projects across Northland, South Auckland and Canterbury”, according to a Brightlight release.
“The funds of Investors in the Bond will be loaned to the owners of the properties under Debt Facilities issued and managed by Brightlight,” the investment memorandum (IM) says. “Brightlight will provide the oversight of repayments from the Borrowers and the monitoring of key financial and impact covenants.”
The bond will pay income quarterly in arrears to the tune of the five-year NZ Swap Rate plus 1 per cent, the IM says, with a first mortgage security against the underlying properties valued at $61 million.
Sam Richards, Brightlight managing director, said in the statement: “The Series II Te Puna Hapori Bond will positively impact the lives of around 330 individuals, families and retired people currently on the New Zealand Housing Register awaiting the provision of social and affordable housing.”
Symons joined the Melbourne-headquartered Brightlight last January to drive its NZ impact project deal-making. He was previously head of Macquarie Capital NZ following offshore experience with investment banks such as Barclays and Investec.
Brightlight spun out of the Australian Christian Super fund in 2016 as an impact-investing specialist with about A$150 million in assets under management.