Community Land Trust Development Fund

Lack of affordable housing is a problem in most areas of the UK.

Community Land Trusts are organisations that seek to address this by securing land and building houses that are partly owned, in perpetuity, by the local community. Houses built by CLTs are sold or rented to people in proven housing need at less than the market rate, the difference between the actual market rate and the sum paid being the CLTs continuing stake in the property. The value of the land, planning gain and any other equity benefits are permanently locked in on behalf of the local community and future occupiers.

While interest in the CLT model is high, emerging CLTs have experienced two major obstacles:

• Lack of technical support during the early and development stages
• Lack of access to development capital

In response the Esmée Fairbairn Foundation and the Tudor Trust have become the first contributors to the Community Land Trust Fund, together contributing £1.75m to a total fund of £2m to support emerging CLTs. The fund will be run in collaboration with Community Land and Finance and Venturesome, the social investment arm of the Charities Aid Foundation. Venturesome who will manage a large element of the fund on behalf of the funders, who will remain involved in decisions about how the fund is distributed.

The Fund will comprise:

• A Feasibility Fund – to provide community groups or fledgling CLTs with one day of expert consultancy support to scope out opportunities, recommend ways forward and develop a concept note.
• The Technical Assistance Fund – this will provide CLTS or emergent CLTS groups with a grant to employ a consultant for up to five days in order to develop initial ideas into comprehensive business plans.
• Pre-Development Funding – Loan finance to enable promising CLT projects to secure planning permission, employ architects and other professionals and conducting site surveys.
• Development Finance – Providing CLTs with capital loans to top up commercially available building development finance.

It is expected that this initial contribution from the Esmée Fairbairn Foundation and the Tudor Trust will enable the establishment of around 30 operational CLTs, and the construction of around 150 affordable homes over the course of the next four years. It is expected that, by demonstrating that CLTs are financially viable, the Fund will encourage mainstream financial institutions to become investors in a greater number of CLT ventures.

To visit Tudor Trust CLT website page please click here www.tudortrust.org.uk/thecltfund.

To visit Venturesome’s website page click here www.cafonline.org/communitylandtrustfund

For further information on the Community Land Trust visit http://www.communitylandtrust.org.uk  

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