Greater Manchester Investment Fund

Background – GMCA and Core Investment Team

The GMCA is a statutory body with functions including economic development and regeneration that cover the Greater Manchester area.

It is comprised of the 10 Greater Manchester local authorities:

- Manchester

- Salford

- Trafford

- Stockport

- Tameside

- Oldham

- Rochdale

- Bury

- Bolton

- Wigan

The Core Investment team is a GMCA team and is responsible for a number of investment programmes aimed at encouraging business growth and investment in property and infrastructure.

Funding Position

The table below summarises the status of the active funds as at 31st March 2015.

Funds are currently in the process of being established for the 2014-20 ERDF allocation. £97m will be directed into successor funds to the existing Evergreen and North West Fund, and a dedicated Low Carbon Fund.

£’m RGF2 RGF3GM Loan

FundGrowing places

NW Evergreen

Fund

2014-20 ERDF

Total

Invested 13.1 34.7 3.4 8.8 13.9 -

Board Approved

36.2 34.7 5.3 33.6 55.3 -

Remainder - - 14.7 21.0 5.2 97.0

Total 30.0 35.0 20.0 54.6 60.5 97.0 297.1

Business funds Property & infrastructure

Our Process – projects > £500,000

Expression of interest submitted to the Core Investment team –

response provided within 48 hours

Project is submitted to the Local Enterprise Partnership (LEP) for

endorsement

Business plan is assessed by the Core Investment team

Project is submitted to the Combined Authorities (CA) for approval (the CA meet once a

month)

Applicant submits a business plan in a standardised format

Draft offer letter issuedApplicant commissions due

diligence

Once satisfactory due diligence has been received along with any other conditions specifically noted in the

offer letter, a loan agreement is issued

Project is submitted to the Chief Executive’s appraisal sub group for approval and consideration of

lending terms

Business plan is reviewed by an Independent Advisory Panel

Why use Evergreen/Growing Places?

Collaboration

• Funding where traditional finance cannot be obtained.

• Works in tandem with other forms of funding.

• Welcomes schemes with grants.

• Quick decision making .

Flexibility

• Competitive costs of debt.

• Flexible terms;• Various methods of

funding:– Senior debt– Clubs &

syndication– mezzanine.

• Flexibility around cash flow timings.

Experience

• Experienced teams originating and managing debt investments.

• Finance and real estate expertise.

• Experienced legal advisors.

• Clearly defined processes.

• Market standard loan documents.

• Eligibility assessment.

Benefits for Developers

6

CBRE | EVERGREEN | FUND BACKGROUND & UPDATE

CASE STUDYThe Cotton Building (iplus), Manchester

The Cotton Building

Speculative Development

£15m loan from Evergreen and Growing Places

Total development costs of £40m

Mezzanine funding by Pramerica

Due to commence March 2014 and complete March 2016

Match funding - £10million Private Sector Investment

13,660 sq/m commercial floorspace

BREEAM Excellent

22,000 sq ft of existing brownfield land will be re-used

The scheme will deliver in the region of 910 jobs

Borrower Allied London

Nature of loan Senior Debt

Size of Loan £10,000,000 Evergreen and £5,000,000 Growing Places

Location Spinningfields, Manchester

Future

• To build upon the success of the existing funds and maintain momentum.

• Fund will be enhanced by the proposed Evergreen II (£50m) and Low Carbon (£15m) subject to UK Government / EU discussion.

• New funds expected to be operational from 2016.