Non regulated crowdfunding platform from Estonia
1) The development laon with 13% fixed interest ( interest calculated from the day placing the investment ):
a) We set the collateral always +20% of the initial funding target. Since it is a development project, the property will have the value on that range once the development is completed. It is hard to estimate the actual value of the collateral at the moment while the construction works are ongoing. We always use local established real estate agency´s for appraisial reports ( in Estonia either Uusmaa or Doomus ).
b) No, we dont have an additional personal guarantee on the project. We use collateral agent ( independent law firm ) for that.
2) Rental property ( short-term rent via booking.com and airbnb ):
a) The SPV does the management ( registered under Reinvest Holding company ) and the annual reports of that SPV is publically available ( investors will be provided with the income reports ). We make our rental yield calculations rather conservative:
The gross rental yield is calculated with 40% yearly vacancy rate ( on the high season the vacancy will be close to 0%, but on the low season it could be 60-70% ). 50eur per night is slightly lower then what other same size apartments are rented for. The net yield 8,3% is the yearly profit after the booking.com / airbnb fees, Reinvest24 fee, utility and operating fees. The 8,3% is conservative estimation, we rather try to under promise and over deliver.
And the same goes for the collateral, it will be set +20% of the initial funding cost and we will have all the properties revalued once a year or after achieving a major milestone.
Hope this answers your questions, let me know if there is anything else.
2% transaction cost when placing the investment? This is the entry fee for all our projects, there will not be any fees to sell your shares on the secondary market, aswell as withdrawing the funds to your bank account. For rental properties there will be operating fee 10% from gross rental yield. So the only fees on our platform are:
The entry fee – 2%
Operating fee – 10% from gorss rental yield ( this goes only for the rental properties )