Project updates

Risk Rating

Criteria	From a+ to d	Project rating
Macro Location Analysis	A+	B+ Originator rating A EvoEstate Risk rating is of an informative nature only & can not be considered investment advice.
Financial Cost	C-
Purpose of the loan	A+
Development's licence	A+
Borrower's experience	A+
Presales	D-
Guarantees	C+
Project Margin	A-

Descripton

Operation

The transaction is located at 179, Boulevard Saint Germain, in the 7th arrondissement of Paris, bordering the 6th arrondissement. Boulevard Saint Germain is one of the most prestigious avenues in Paris, renowned for its upscale shops in a rather residential and affluent neighborhood.

The asset concerned by this operation is a luxury prêt-à-porter boutique located at the foot of a 5-story freestone building. It extends over a ground floor comprising a sales area, a back shop and a basement dedicated to sales. The total surface area of the shop is 152 m².

This property was acquired by FMA in 2019, which then revalued the lease with Brunello Cucinelli (from €120,000/year since 2010 to €220,000/year), significantly improving the rental yield of the shop and therefore its value.

The proposed refinancing corresponds to the advance on the margin that will be generated following the resale of this property. Another exit option being considered is bank refinancing.

The Capitalium Real Estate funds by Raizers invests 295,000€ in this operation

Detail of the asset

*According to the Cushman & Wakefield valuation of February 2019

It should be noted that the profitability at the time of acquisition was 3.75% on the initial rent.

The shop is leased to Brunello Cucinelli, an Italian luxury ready-to-wear brand created in 1978 and specializing in the production of cashmere pieces. The group is present worldwide through dedicated subsidiaries in each country and owns 3 other boutiques in Paris in the 8th arrondissement (Rue du Faubourg Saint-Honoré, rue François 1er and Avenue Montaigne).

The company was floated on the stock exchange in 2012 and on 30/06/2020, its valuation was €1,797,920,000.

Consolidated view of the Group:

The Group suffered from the health crisis linked to the coronavirus, which led to the occasional closure of a number of shops and thus impacted its turnover.

Market price

Our valuation of properties is based on prices observed in the retail market.

An average rate of return of 4.22% has been observed according to the Cushman & Wakefield Report:

Examples of transactions:

A valuation was carried out by Cushman & Wakefield in February 2019 with an average price per m² of €40,688. The average price per m² of 32,456 €/m² used for our valuation corresponds to the average of different valuation methods.

Provisional schedule

Legal arrangement

The transaction is being carried out by SAS FMA Renouard Larivière, with a capital of 76,700 euros, registered with the Paris Trade and Companies Registry under number 571 226 371 on 17/12/1967. It will carry the bond issue and is 51% owned by its Jean-Marc Israël.

The bond issue will be issued by SAS FMA Renouard Larivière at an annual rate of 10% per annum for a period of 24 months.

Interest for the first twelve months will be capitalized, i.e. it will not be paid to investors but will generate interest itself. All interest will therefore be paid on the maturity date of the bond issue at the same time as the capital.

In order to provide additional security, the repayment of the bond is guaranteed by:

* Personal guarantee of Jean-Marc Israël

* First Demand Guarantee from SARL Financière Raspail with two assets in the 7th arrondissement (rue Vaneau and rue Monsieur Le Prince) for an estimated net value of €6.9M.

The bond contract provides for early repayment if:

* Sale of the Bruno Cucinelli boutique

All the documents associated with this fundraising are available in the "documentation" tab.

SWOT

Operation budget

Financing structure

Shareholders presentation

Jean-Marc Israël, 44 years old, French:

Jean-Marc Israël is a real estate professional who has been working in the sector for more than 20 years. He began his career at the end of the 1990s with the Foncia Group before becoming a real estate investor in the early 2000s. Jean-Marc has more than forty property acquisitions to his credit, ranging from €5 million to €150 million.

FMA is an asset management company whose vocation is to acquire retail premises or buildings on prestigious thoroughfares, mainly on the Left Bank of Paris.

Its real estate assets are estimated at approximately €33 million net of debt through its various companies.