Social Enterprise Mark holder Southville Community Development Association (SCDA) and Triodos Bank have launched a bond offer to help raise £280,000 towards the cost of the Chessel Centre, a new £1.19m community hub and nursery in Bedminster, Bristol.
The centre, which will open in the autumn, will comprise a 54-place nursery, a meeting room for use by local community groups/activities such as after-school clubs for children and social clubs for older people, as well as large outdoor play spaces for the nursery.
Working in partnership with the corporate finance team at Triodos Bank, the SCDA bond is expected to pay 4% gross fixed annual interest for six years. The minimum investment is £500 and investors in the project may be eligible for Social Investment Tax Relief.* Payment of interest and repayment of capital are not guaranteed and are dependent on the continued success of the SCDA’s business model and the new nursery.
The SCDA’s core activity is the provision of high quality childcare and education for children under five, with around 180 local children using its nursery services at the Southville Centre. The OFSTED outstanding rated nursery has been such a success that it is currently at full capacity, with a waiting list of 250 children and families often waiting up to two years for a place. As an ethical organisation the charity also holds the Social Enterprise Mark and Gold Standard from the Green Business Tourism Scheme.
The opening of this second nursery will not only enable more families to have access to high quality local childcare and provide additional community facilities for the area but, by generating greater surplus, will enable the SCDA to increase its charitable activities and investment into the Bedminster community. Situated on the site of the former Boys Brigade building at the corner of Chessel and Garnet Streets, the new 476 sq m Chessel Centre will also support the local economy by providing new jobs and using local contractors for the building works.
The £1.19m total cost of transforming the site is being met through a combination of £196,000 from the charity’s reserves, capital grants and repayable finance. In addition to the funds raised through the £280,000 public bond offer, the SCDA has been awarded grants from Bristol City Council (£74,000) and the Power to Change Community Business Fund (£300,000). Furthermore, the bond is expected to qualify for a further £280,000 of matched funding from Big Society Capital managed by Ethex.
Simon Hankins, CEO of SCDA, said: “Our values as an organisation have always focused on what’s best for our local community. The exciting thing about this bond is that Triodos found a way to allow our community members to invest in something that will directly benefit them in return, in respect to both our shared community and our financial wellbeing. I like to think of it as a form of crowdfunding for BS3.”
Dan Hird, head of Triodos Bank Corporate Finance, comments: “It’s not often that investors get the chance to support a well-known charity on their own doorstep and actually see the positive change their investment can have. We’re confident that local investors will want to support the SCDA as they address the growing local childcare need and improve the lives of area residents.”
For more information please visit the SCDA website.
* The SCDA has received advance assurance from HMRC that the bond offer should be eligible for Social Investment Tax Relief (SITR). SITR encourages individuals to support charities and social enterprises and in turn helps those charities and social enterprises to access new sources of finance. Individuals making an investment in the bonds can, depending on their circumstances, benefit from income tax relief at 30% of the amount invested. The availability of SITR can increase the total return over the full term of the bond to an estimated 10.3% gross per year for a higher rate (40%) taxpayer. The ability to benefit from SITR depends on an investor’s personal circumstances, current tax legislation and the company’s compliance with the rules.
Investment decisions must only be made on the basis of the offer document and not on any information provided in this news release. Investing in the SCDA bonds is not the same as depositing your money in a bank account as your capital is at risk and you may not get back the full amount that you invested. An investment in the SCDA bonds is not covered by the Financial Services Compensation Scheme.