L'Orfebreria II

 Development loan
Barcelona,
Spain
9%
Annual yield
Term: 12 months
Interest payment schedule:
Quarterly

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Descripton

Project summary

 

SHREM GROUP (Mahir Investments SL) manages this investment opportunity in one of the areas of Barcelona that are increasing in value, the Poblenou neighborhood, within the well-known 22 @ district.

The developer is transforming an old disused artisan workshop, "L'Orfebreria", located at Calle Sancho de Ávila 41, into a 33-luxury loft building that will provide all the services and amenities but always preserving the unique character of the workshop Initial since it is a building from 1963 listed as protected industrial heritage.

The set will have, in addition to the houses finished with the best materials and comforts, with common areas, bicycle parking, terrace, interior garden, storage rooms for each of the apartments and parking spaces.

The promoter has already provided approximately € 5,000,000 of own resources for the execution of the promotion and is requesting a fixed interest loan of € 200,000 for land excavation works, offering a total return to the investor of 9% in a maturity term. 12 months. The total amount of this item amounts to almost 500,000 euros, so the amount requested represents only 40% of it. It is important to highlight that it is the second opportunity of this promoter / opportunity. It was already planned in phases and the first was 250,000 euros to finance the construction of the storage rooms attached to the houses.

It has reserves of 13 of the 33 homes and the work is in full swing with 30% completed. You will not have to wait for the sale of the properties to obtain quarterly returns!

The promoter

 

Mahir Investments SL is part of the Shrem Group, a real estate developer with more than 35 years of experience in the sector, specialized in the construction of residential homes. 

The company currently operates in Spain, the United States and Bulgaria, and focuses its real estate development on high value-added developments, which can become not only residences for the buyer but also investments that generate passive income.

It currently has more than 150 apartments under development in Barcelona alone.

The building

 

The spectacular "L'Orfebreria" building was built in 1963 following the so-called "brutalist" architecture, characterized by its sober lines, a preponderance of industrial materials such as cement and iron, and a rationalist approach, subjecting any stylistic consideration to the use of the building .

In this case, the old factory will be transformed into 33 homes. The structure of the building will be respected, as well as the main staircase and other details that will be preserved as it is considered a protected industrial heritage. 

The floors will be "loft" with different sizes between 70m2 and 115m2. They will have private terraces as well as common areas such as the interior garden, concierge, storage rooms and bicycle parking lots. Preserved materials will be restored if they are found to be in poor condition and superior design and quality finishes will be used for new materials.

The project has the financing of a bank, which has constituted a mortgage on the property and the works are in full execution.

Learn more here.

The history of the project

 

Learn about the history of the Project from Itai Salomon Shrem: Itai Salomon ,, Managing Partner at SHREM GROUP.

Click here to learn more.

The project

Check the project website here:  L´Orfebrería

 

The environment

 

The "L'Orfebrería" project is located in a special location, 10 minutes from Barcelona beach and 10 minutes from Plaza de les Glòries, a business hub where more and more large national and international corporations are establishing their venues.

The Poblenou neighborhood and the area where "L'Orfebrería" called 22 @ (twenty-two arroba) is located, is in turn an area of ​​concentration of technology companies and startups. These have led the transformation of the neighborhood, which has gone from being a depressed area to one of the most coveted areas of the city. 

The environment has, in addition to the beach and the large Ciutadella park 10 minutes away, with other iconic cultural centers of the city, such as the Auditori or the TNC (Teatre Nacional de Catalunya), world-class hospitals such as the Hospital del Mar, various schools and all kinds of amenities such as artist workshops, design shops, restaurants and charming bars that have proliferated in recent years. 

The neighborhood offers an excellent quality of life thanks to the sea breeze that constantly cleans the air, and all the comforts that the big city offers. All this has made Poble Nou an area increasingly desired by families or couples desiring tranquility and quality of life within the city.

The loan

 

The loan is presented as a very attractive investment opportunity:

  • Purpose:  The loan issued will finance part of the land excavation works.
  • Type of product:  Fixed interest loan.
  • Annual nominal interest:  9%
  • Total Estimated Return:  9%
  • Expiration term:  12 months
  • Frequency of interest payments:  Quarterly paid for quarters past due as of the day following the loan start date.
  • Amortization type:  At maturity.
  • Guarantees:  Recognition of debt before a notary.
  • Stages: The financing through the platform occurs in two phases, the first one concluded successfully after financing € 250,000 and this second stage provides for the financing of an additional € 200.000 for another item of the work, as we have previously commented

Market overview

 

The real estate dynamics in Barcelona and particularly in the area considered, due to its proximity to the beach, is positive, both in second hand and in new construction. In the latter, it is discreet due to lack of land and / or renovations with new works or changes of use, with discrete 1 or two-room surface programs as the most common offers, of good quality as they are intended for consumers with good purchasing power.

Demand is receptive to the offers that are produced and absorbs the offers since the acquisition prices by reducing the surfaces are more or less accessible, except for extensive programs on the seafront, where prices multiply.

Rates

 

Stockcrowd IN Support Fee: This  is the fee charged by Stockcrowd IN for the use of its technology. It is not included in the project costs and will be paid by the promoter or manager outside the project, therefore, it will not be attributed to investors. It is disbursed when the promoter / manager registers with StockCrowd IN as Set-Up (up to 3,000 euros depending on the class of the Promoter) and through a monthly payment (up to 750 euros), plus the corresponding VAT.

Stockcrowd IN Success Rate:  It is the rate that Stockcrowd IN will charge that will be determined based on a% of the funds obtained for the project, as long as it is successfully closed, that is, that the objective of the published financing is reached on the platform. In case of not closing successfully, StockCrowd IN will not charge this commission. Once the campaign is finished and as a previous step to the delivery of the money to the promoter / manager, this commission is deducted from it in favor of StockCrowd IN. It does not affect the final profitability obtained by investors, since the Promoter is the one who assumes its cost. In this project 2.5% + VAT is charged.

Payment gateway fee: It is the fee charged by StockCrowd IN for intermediation with the provider of the payment gateway and custodian. The promoter or manager makes the payment of 1% on the maximum amount of the financing objective that can be achieved in the campaign. In the event that the campaign does not reach the financing objective, the proportional part of this rate will be paid to the Promoter with respect to the amount of the maximum objective of the financing not reached. Also, in such case, the investor will fully recover the amount invested. It does not affect the final profitability obtained by investors, since the Promoter is the one who assumes its cost.

Risks

 

Investing in this project involves the following risks: risk of not obtaining the expected monetary return, risk of falling prices, risk of not completing financing, political risk, risk of rate hikes, risk of lack of liquidity to recover capital invested, subordinate nature of the loan (particularly vis-à-vis the mortgagee, in those cases in which the acquisition of the property object of the project is financed additionally by loans with mortgage guarantee), risk of total or partial loss of the invested capital and risk of fraud.

Risk of falling prices:   That the price of the property falls due to the increase in supply or decrease in demand in the area. There may also be a general drop in property prices due to a multitude of factors.

Mitigation:  The developer knows perfectly the dynamics of the market and his team is made up of professionals with extensive experience in the sector. Their knowledge and know-how allows them to identify and anticipate price trends, anticipating the market. There is an appraisal of the property and sometimes a market study is carried out.

Liquidity risk:  Unable to find a buyer when you want to sell the property.

Mitigation:  The sales team knows the market dynamics and is structured with a team of collaborators in intermediation services to reduce this risk.

Interest rate rise risk:  Increase in the cost of financing the purchase of real estate (mortgages). Which would push down the demand of the housing market.

Mitigation:  The most reputable economists predict that the European Central Bank will not raise interest rates dramatically this year. And the upload that will be implemented in the future will be very slow.

Political risk:  What happens if political instability grows during this year.

Mitigation:   Being an asset located in a highly consolidated and exclusive area, it does not have a frontal influence, allowing to reduce this risk significantly.

Risk of not completing the financing:  What happens if the investments do not complete the entire objective of the opportunity in the expected time.

Mitigation:   The Law for the Promotion of Business Financing 5/2015, allows Participatory Financing Platforms to exceed the initially foreseen term of up to 25%. If the opportunity has reached at least 90% of the financing objective, it may be effectively completed. In the event that the campaign does not reach the minimum 90% of the project, all amounts are returned by the platform at no cost to the investor. The funding campaign can also exceed the target by 25%.

Risk of total capital loss or of not obtaining the expected monetary return:  It is important to keep in mind that there is no safe investment, and as with any investment, there is always the risk, not only of not obtaining the expected returns, but of losing all than invested. There may be a bankruptcy or bankruptcy by the developer or the estimates in your business plan may not be met for various reasons.

Mitigation:   StockcrowdIN runs a risk analysis of both the developer and the opportunity. It is studied that the promoter is up to date with AEAT and TGSS and that it is not registered in the RAI Likewise, it is studied that no information has been registered on a claim by the Public Administration, nor legal claims and that the company deposits its accounts with regularity.

Fraud risk: It  should be noted that there may be a fraud risk due to improper use of the money obtained for the project. There may be a fraudulent use of money from any real estate transaction.

Mitigation:   In accordance with the Law for the Promotion of Business Financing 5/2015, StockcrowdIN requests a criminal record and an Honorability Test from administrators and shareholders with high participation in the companies that execute the project. Also, explain that until the participatory financing campaign is completed, the promoter does not have the funds by going to an "escrow" account where he does not have access. It is also required that every two months, the promoter is reporting the use of money and therefore the evolution of the project. You are also required to keep separate analytical project accounting.

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Documentation

9%
Annual yield
Term: 12 months
Interest payment schedule:
Quarterly
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