Funded
  • Deadline
    24.10.2022
  • Start of investment period
    02.11.2022
  • Start time
    30.09.2022 12:30
  • Asset class
    Residential
  • Investment type
    Development
  • Investment end date
    02.11.2023
  • Remaining term
    10 months
  • Expected rate of return
    14% p.a.
  • Expected cash yield
    %
  • No of investors
    350
  • Goal
    €164 900

Executive summary

With this project, the Sponsor aims to raise a total of 500 000 Euros by providing a second-rank mortgage on a property in Caminho da Torre Velha, Sesmarias, Albufeira, a well-known holiday location in the Algarve, Portugal. 

The collateral includes a 5 070m2 plot of land with 10 townhouses units, two groups of 5 units each in a gated condominium with a shared garden and two swimming pools. This project was concluded in the past, but due to the subprime crisis's events with the original project Sponsor, it never got the final usage license and couldn't complete the commercialization.

As per the attached appraisal, the estimated market value of the collateral is 4 200 000 Euros.

After successfully raise 135 100 Euros on the first tranche, we are now campaigning for the second round of funding, where the Sponsor wants to raise 164 900 Euros out of a total 500 000 Euros. The remaining loan amount will be mobilized through the next funding rounds.

The Sponsor got a bank loan worth 2 000 000 Euros to purchase the property, and now he is looking to raise this additional amount to proceed with renovation work on the property, get the usage license from the City Hall, and then sell the units.

A commercial bank has the first-rank mortgage registered under its name. Crowdestate investors will have the second rank mortgage.

According to the attached appraisal, considering this tranche's value, the ratio of the project's short-term liabilities to the value of the collateral (LTV) is 53%. Therefore, after the subsequent tranches, the maximum LTV for this project is 60%.

The interest rate of the loan is 14% per annum.

The loan period is 12 months, with a Sponsor's option to extend it by 6 months with the obligation to increase the interest rate by 2% for the extended period.

The principal and interest payment will be made as a bullet payment or earlier following the sales of the townhouses.

The source of loan repayment will happen with the sale of real estate townhouse units.

Crowdestate

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