Pluto Finance, a leading specialist property lender providing finance to small and medium-sized housebuilders, is pleased to announce a substantial strategic investment by the Universities Superannuation Scheme (“USS”), the UK’s largest private pension scheme with over £80bn assets under management.
USS has made a significant minority investment in Pluto Finance to enable a major expansion of the business, as well as committing £75m as a cornerstone investor alongside Pluto’s sixth development lending vehicle, which is targeting a £300m capital raise this autumn. These funds will be used to provide financing to SME developers delivering new housing in the UK; Pluto has already financed the construction of more than 10,000 homes in the last 10 years.
This new commitment will supplement the existing £840m of institutional capital currently supporting Pluto’s lending activities, funding growth of Pluto’s existing strategies as well as planned new initiatives in commercial and residential investment lending.
Justin Faiz, Co-Founder of Pluto, comments: “We are delighted to be working with USS. With its size, long-term perspective and commitment to the UK, USS is the perfect partner to help Pluto with its next phase of growth to become the leading one-stop-shop for all types of UK property finance. Its support will allow us to expand our team and move into adjacent lending strategies, whilst maintaining the quick turnaround and flexibility that our borrowers have come to expect from Pluto. The USS investment is an incredible endorsement of our hard-working team and our lending track record, of which we are immensely proud.”
Eamon Ray, Senior Investment Director, Private Markets Group, USS Investment Management, comments: “USS is delighted to have established this strategic partnership with Pluto, highlighting our commitment to long-term investment in the UK particularly in critical sectors such as residential housing. The UK faces a chronic housing shortage and the sector requires long-term sustainable capital to meet national targets. We believe our partnership with a leading specialist in this sector will help bridge this gap in provision whilst providing our members with attractive returns to fund their pensions.”
Pluto closed its first real estate debt vehicle in 2011 and since then has lent over £2bn across more than 200 real estate loans, providing development finance as well as providing short term finance for acquisition, re-positioning or sell-through. The USS commitment to Pluto real estate private credit vehicles will sit alongside the capital committed by Pluto’s existing pension fund, insurance, asset management and other institutional investors.
Bryan Cave Leighton Paisner acted as legal counsel and Alvarez & Marsal acted as tax advisor to Pluto.
NatWest Markets acted as financial advisor, Linklaters acted as legal counsel and PwC acted as tax advisor to USS.