This is the financing of a 275 m² villa with a 190 m² private garden as part of a sale with a buy-back option for €1,170,000. The villa is currently for sale at €2,750,000.
The villa is located in the Californie district in Cannes, less than 10 minutes by car from the Palais du Festival de Cannes.
The transaction is a sale of a property leaving the option for an initial seller to buy it back within a set period of time, at a price fixed in advance.
Governed by the French Civil Code, the sale with a buyback option mainly enables the initial seller to have access to cash quickly.
For Raizers investors, the main advantages of this transaction are :
* The valuation of the property acquired enables the loaned amount to be covered.
* Interests are paid in advance into an escrow account
* Interest will be distributed semi-annually
For this transaction, the directors of Equinox - a real estate investment fund - created a dedicated company, SAS Araucaria, with the aim of acquiring this villa in Cannes.
On 4 September 2020:
SAS ARAUCARIA became the owner of the villa for a price of €1,170,000, in exchange for giving the Initial Seller the option to buy the villa within 23 months. Equinox advanced a share of 500,000€.
Before 30th November 2020:
The Raizers bond will pay the balance of the purchase price and repay the 500,000€ equity advanced by Equinox.
A 163,800€ occupancy indemnity (corresponding to 23 months' interest at 7%) will be held in an account to secure the payment of bi-annual interests for the next 23 months.
In the case of non-refund after 23 months:
In the context of this acquisition with a repurchase agreement, if the repayment is not made before 4 September 2022, Araucaria will be free to sell the property at the desired price in order to repay the bond loan in priority.
Compensation for late payment has been set for the benefit of the Raizers investors: 15% of the capital gain will be paid to them.
The villa is part of the Domaine Californie program, delivered in 2017, which includes three buildings.
The complex, built in a contemporary style, benefits from an exceptional environment with a quiet landscaped park.
The estate offers a magnificent swimming pool area with a pool house, a gym, a security service and remote surveillance.
The villa includes :
* On the ground floor: an entrance hall, a living-dining room, a laundry area, a bedroom with an en-suite bathroom and a dressing room. All overlooking the pool and the garden
* Upstairs: two additional bedrooms with shower room, dressing room and toilets
* Large terrace of 145 m² and private garden of 190 m² facing south-west with swimming pool
* 3 car parks
The villa being new, there is no work to be done: the property is sold as-is.
The marketing of the villa is currently handled by John Taylor Estate Agency.
The posted selling price is 2 750 000 €, i.e. 10 000 €/m² for this 275 m² villa with 3 car parks.
The marketing price of €2,750,000, i.e. €10,000/m², is in the upper end of the market, as this is a very recent villa, offering top-of-the-range services and sold with 3 car parks.
The estimated selling price is 2 200 000 €, i.e. 8 000 €/m². The average price in this area is 6,500 €/m², comprising mainly old properties.
The cost price of this house by Araucaria is 1,170,000 €, i.e. 4,000 €/m², or 50% of the estimated selling price.
Number of rooms: 5
Area: 151 m²
Price: 2 750 000€
Price m² : 18 212€
This property is composed of 6 rooms including 5 bedrooms each with its own bathroom, 1 kitchen, 1 separate office and 4 balconies surrounding this high-quality flat. Nestled in one of the most sought-after areas of Cannes, in a quiet and green setting just a stone's throw from the Croisette, come and discover this magnificent flat with luxury amenities. Former prestigious hotel at the end of the 19th century which was entirely renovated a few years ago into a luxury flat residence with all modern conveniences. This magnificent building is located around a 7000 m² park with remarkable trees and offers top-of-the-range services such as a swimming pool, sauna, concierge and gym. Possibility to have 2 additional garages. Ideal for families looking for large volumes, refined services, comfort and tranquillity.
Number of rooms: 6
Area: 206 m²
Price: 1 600 000 €
Price m²: 7 767€
Very residential sector. In a quiet environment, with south exposure this house / villa (villa) of 184 m² (about 1978 ft²), with a land size of 750 m² (about 0,19 acres) contains 7 rooms including 5 bedrooms. It is equipped with a living room of 30 m² (about 322 ft²), with a swimming pool, with a terrace, with a garage, with 3 parking and with 2 cellars.
Number of rooms: 7
Area: 184 m²
Price: 1 490 000 €
Price m²: 8 098€
The bond will be issued by SAS ARAUCARIA at an annual rate of 7% per annum for a period of 23 months.
In order to comply with the regulations governing bond issues, SAS ARAUCARIA has carried out an asset-liability review of its business.
In order to provide additional guarantees, repayment of the bond issue is guaranteed by:
* Promise of mortgage assignment on the villa
* Irrevocable transfer order to the notary on the villa
* Prohibition to alienate and right of pre-emption
* Occupancy payments blocked in an escrow account
* Pledge of the shares of SAS ARAUCARIA
If the seller does not activate its buy-back option, SAS ARAUCARIA will pay 15% of its net capital gain to the RAIZERS lenders in addition to the repayment of the capital loaned.
All the documents associated with this fundraising are available in the "documentation" tab.
For the 3rd scenario, it is a simulation of a resale one year later by SAS ARAUCARIA of the villa at a price of 2,000,000€.
The Raizers investors will then receive 135,000€ on the resale, i.e. a return of 11.5% over the 3rd year.
Equinox specializes in arranging real-estate refinancing by means of a security trust or sale with a buyback option.
Equinox sets up a company for each transaction. It then finances the equity of the structures dedicated to the transactions through a bond loan.
Associate 1, Mr. Camille Marne, co-founder of Equinox Capital SA created in 2018.
He has 10 years' experience as a property trader, either directly or through buyout transactions, and has co-invested in club deals and mezzanine financing with property traders (more than 15 transactions and €18 million in private debt). He also spent 15 years in wealth management, private banking and real estate financing (Société Générale, JyskeBank, then as an independent).
Associate 2, co-founder of Equinox Capital SA.
He has 8 years' experience as a real estate trader, either directly or through repurchase agreements, and has co-invested in club deals and mezzanine debt with real estate traders (more than 25 transactions and €15 million in private debt). He also has 17 years of experience in wealth management, private banking and real estate financing (BNP Paribas, BIL, then freelance).
Associate 3, a shareholder of Equinox Capital and is not involved in the management of SAS ARAUCARIA.
Balance sheet company ASSOCIATE 1
Income statement company ASSOCIATE 1
Balance sheet company ASSOCIATE 2
Income statement company ASSOCIATE 2