Funded
  • Deadline
    03.07.2020
  • Start of investment period
    17.06.2020
  • Start time
    09.06.2020 07:15
  • Asset class
    Residential
  • Investment type
    Development
  • Investment end date
    28.05.2022
  • Remaining term
    20 months
  • Expected rate of return
    15.9% p.a.
  • Expected cash yield
    %
  • No of investors
    375
  • Goal
    €197 000

Executive summary

Crowdestate investors have funded the Sponsor's investment obligation in construction of a new Koru primary school in Veskimöldre-2 residential area. To date, the Sponsor has sold 28 plots and fully repaid the first round investors' loans of EUR 500,000 plus interest and EUR 193,000 principal of the second round loan. The final return (IRR) for the first round was 16.3%. 

Due to the successful sale of the Veskimöldre-2 plots at higher than initially expected prices and the need to release equity (in particular to finance the construction of shopping center at Instituudi tee 132 property), the Sponsor has decided to offer an additional investment opportunity in amount of EUR 197,000. Together with the additional amount, Crowdestate investors' loan balance is EUR 1,167,000

Loans are secured by a mortgage on 89 residential plots (total 143,311 m2) market value at EUR 7.4 million (excluding VAT). The outstanding senior loan balance is EUR 2.94 million (secured by 1st and 2nd mortgage). Crowdestate investors' loans are secured by next mortgages after the senior loan. Total Crowdestate investors' loans (incl. current 7th tranche) amount EUR 1,167,000 and the Project's LTV is 55.6% (the ratio of loan principal amount to the market value of 89 plots). The market value estimate is from October 2017. Price list and real transaction prices are about 15% higher than the appraised market value. In addition to the mortgage, parent company Brave Capital OÜ has issued a guarantee of EUR 200,000. The value of guarantee is not included in the collateral value.

Following Covid-19 emergency situation, the Sponsor has sold two plots at a price level that corresponds to the business plan and current price list.

Crowdestate investors' loan bears an interest rate of 15% per annum. Interest will be paid quarterly and loan principal returned from the sales revenue of residential plots - 30% from the sales value (excluding VAT) of each plot will be transferred as repayment of Crowdestate investors' loan.

The investment period is up to 23 months. The expected return (IRR) on a loan with quarterly interest payments is 15.9%.

The development of Veskimöldre-2 residential area includes 170 plots for single-family houses, 121 row house apartments (semi-detached house), a supermarket, dining places, health trails, schoolhouse. Residential plots are priced between EUR 90,000 and EUR 160,000 (average EUR 120,000) and average size of plot  is 1623 m2.

Crowdestate

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