“A SIMPLE, TRANSPARENT INVESTING PROCESS” 

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Investment Summary

 

Invest in a loan for a 21 luxury apartments project for the next generation of Cyprus and Overseas students living in Nicosia. With student accommodation, already unquestionably the best performing investment sector in Cyprus year after year, the luxury apartments we are now in a position to finance, can certainly be counted among our crown jewels. 

 

The developer is requesting a loan of €500,000 in order to complete the underlying property. The property was purchased for a total of €800,000 in March of 2016. The borrower plans to sell the property. 

 

Purchase Price: €800,000

Development Cost: €750,000

Completed project Value: €2,400,000

 

An independent third party appraisal commissioned by C4F, shows a Completed project Value of €2,400,000. The LTV ratio is 20% and is in line with the data we found during our due diligence process. Our research shows the Student housing market surrounding the underlying property in this area is stable and supply and demand are in balance. 

 

Financial Overview

 

• 24 month hold term at 15% P.A, net of C4F's administrative costs

• Underlying loan secured by first position lien on title and personal guarantee of the developer.

• 1,470 sq.m / 21 luxury one Bedroom Apartments / Student Housing

• 20% LTV

 

The developer is contributing €1,050,000 in a combination of property purchase and development costs. C4F is contributing a €500,000 loan for development costs for a total capitalization of €2,400,000.

 

The Crowdlending Process

 

Crowdlending is the process of multiple investors coming together to finance a project. Investors receive their returns through interest payments. When you commit funds to this project, money will be sent to the client account but no money will actually leave the client account until the crowdlending target is reached. If the crowdlending target is not reached, your funds will be returned. Your investment on the platform is made via the purchase of shares in a Special purpose vehicle (SPV), which is a Company, established specifically for financing that individual project. There is a different SPV for every project; therefore you will always know that you are investing in a specific project chosen by you. At the point of investment you will be required to enter a set of investment documents. These are standard form for each investment and sample documents can be accessed before you decide to invest. We encourage you to seek independent legal advice if you require assistance

 

Income

 

Interest will begin to accrue at the date each investors funds clear escrow. Distributions of interest only will be paid as loan payments from the Borrower are processed. Borrower will pay interest only payments to the SPV which will in turn be distributed to you as an investor quarterly at your fractional investment amount. Total repayment of capital is expected on or before the end of March 2018. Distributions will be made directly into each investors account.

 

Property Overview

 

A 21 luxury apartments project 350m from  the University of Cyprus

 

Borrower

 

The borrowing entity is led by a team of real estate professionals with over 30 years of experience. The team is comprised of finance, acquisitions, management, design, construction and marketing experts. They focus on student housing and residential markets in Nicosia, Cyprus and invest in projects that have substantial value-add opportunities, allowing them to maximize their returns.

 

Risk Profile

 

Monitoring the risk factors in your portfolio is an important part of the due diligence process. As such, C4F has created a proprietary risk profile for your review. In keeping with our policy of absolute transparency, we're showing you the same risks, mitigants, and high level risk factors that play into our decision-making process. 

 

Risk: Low 

Borrower Contribution: 80% 

Borrower Track Record : Successful Development & Resale of Multiple Properties

Local Market: Stable 

 

Risks Mitigants: The borrower does not complete the project. The borrower is contributing €1,050,000 (80%) and the loan is funded at only 20% LTV. This allows for a reasonable expectation of recovery of capital in a liquidation scenario. 

 

Market Description

 

Student accommodation, is unquestionably the best performing investment sector in Cyprus year after year.
 

It is evident from the improved fiscal indicators that the Cyprus economy is slowly entering a path of recovery. For the real estate market the significant increase of 25,8% in sales deeds during 2015 is a strong sign that the market may be starting to recover.

 

The local demand is very strong due to the culture of Cypriots who consider owning their own home as an absolute must and will do their best to achieve it once they get married. The parents also help to a great extend saving money all their life to help their kids buy a house. Home ownership in Cyprus is one of the highest in Europe at more than 80%.

Foreign buyers also started to come back due to the improving economy, lower prices and generous incentives offered by the government. We have the traditional foreign buyers who choose Cyprus for its beaches, friendly culture and ever-shining sun. The last few years we also have buyers from China, Russia, Ukraine and Middle East buying properties for investment and/or to obtain Cyprus (EU) Citizenship & Permanent Residence.