UK TV property presenter seeks £50m for 600 sustainable homes
TV presenter and property developer Kevin McCloud's company, Happiness, Architecture, Beauty (HAB) will issue a bond for private investors, to raise £50m ($65m) to construct around 600 “beautiful and sustainable"homes in Bristol, Oxfordshire, Somerset and Wiltshire, over five years. The bond, which features warnings that it will not be covered by the Financial Services Compensation Scheme and will be quoted on the Gibraltar stock exchange, among others, is expected to return 4.8% per year. McCloud said the HAB developments would include social housing and shared amenities, but would not come with a 'McCloud premium' on the price.
Grand Designs presenter Kevin McCloud is seeking to raise up to £50m to build about 600 “beautiful and sustainable” houses a year in a challenge to the soulless, identikit estates built by conventional developers.

McCloud’s firm, HAB (Happiness, Architecture, Beauty) is hoping to raise the money through a bond for private investors, promising a return of 4.8% a year over a five-year period.

The money will be used to buy land and start construction on houses, mostly in the south-west of England, that McCloud promises will be “a pleasure to live in”.

The bond issue marks a big step-up in housing development by McCloud, now filming his 18th series of the homebuilding and renovation television programme.

Until now, McCloud has been behind several small projects, with 42 homes built in Swindon, 78 in Stroud and 50 in Winchester. The £50m will help to finance a tenfold increase in development, with sites for 675 homes identified around Bristol, Oxfordshire, Somerset and Wiltshire with a gross value of about £170m.

McCloud’s investment scheme comes with a lengthy list of wealth warnings. The bond is not covered by the Financial Services Compensation Scheme, so investors could lose all their money. The money is locked away for five years, and investors will not find it easy to transfer or sell their holdings during that period. The HAB Bond will be quoted on the Gibraltar stock exchange, which, although governed by EU regulations, means it can be sold only to sophisticated investors, with the minimum investment set at £10,000.

McCloud said he had spent a decade evolving the concepts his TV viewers are familiar with – green and sustainable homes, individually designed, from the grand to the sometimes eccentric – and translating them into homes for a much broader market.

“I sincerely believe grand designs are not the preserve of the one-off or that you have to use straw bales in their construction. The challenge of the next 30 years is for us to build new, and retro-fit old, homes in a socially and environmentally responsible way. We can only do that with critical mass.”

The challenge of the next 30 years is for us to build new homes in a socially and environmentally responsible way Kevin McCloud

He said all his schemes would include social housing and designed to have shared public amenities and social spaces. Homes would have “high thermal mass” so they do not lose heat easily, and estates would include electricity micro-generators, he said.

McCloud added that he had learned from the small-scale developments built by HAB so far.

“I’ve learned that as much as you can be ambitious and wave the flag for sharing and sustainability, the reality is that most people lead very busy lives. It’s important to put in place professional management and keep it modest.”

He said there would be no “McCloud premium” on the price of the planned homes, although every scheme so far had been a sellout and “unlike other developers we have never had to discount our homes”.

The first £10m of the cash raised by McCloud will finance the construction of Elderberry Walk in Southmead, Bristol, which is scheduled to begin later this year.

It will consist of a range of homes from one-bedroom flats to four-bedroom houses designed around a central, 20-metre-wide “green street” linking the surrounding housing to the neighbouring park. HAB aims to turn a derelict city site into a sought-after residential location, with more than 30% of the homes earmarked as affordable to those on lower incomes.



This is not McCloud’s first fundraising exercise. In 2013, HAB raised £1.9m of equity crowdfunding from 649 investors, and in January this year picked up another £2.4m with a ”mini-bond” offering a much higher rate of interest, at 8%.

Investors may wonder why HAB is returning to investors so soon after the earlier bond. “Whilst the HAB Land mini-bond was a great success and raised around £2.4m, the potential new sites require a significant increase in funding,” he said.

