Project updates

Risk Rating

Criteria	From a+ to d	Project rating
Macro Location Analysis	C+	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	B+
Development's licence	A+
Borrower's experience	A+
Presales	A-
Guarantees	C+
Project Margin	C-

Descripton

Operation

The Les Bastidons des Alpilles operation is being carried out by the Regency Group, headed by Mr. Fichard, which has been developing real estate operations for more than 40 years.

Raizers is involved in the financing of the second phase of the interior renovation works of a property complex for holiday homes, comprising 38 dwellings, reception, tennis court and swimming pool.

More than 85% of the first tranche has now been sold. The last 3 remaining lots have been reserved by the operator.

Each renovated housing in the second phase will be sold on a lot-by-lot basis to purchasers wishing to occupy it for a few weeks a year to spend their holidays and to rent it out, if they wish, on a weekly basis for the rest of the year.

Zoom on the program

The acquisition of this tourist residence was completed in early 2018 and financed by the Rothschild-Martin-Maurel bank. No renovation work had been carried out on this residence for more than 20 years.

Between 2018 and 2020, after obtaining a building permit, a works program (€1.2 million or approximately €1,000 per sq. m) was carried out by the operator of this residence to renovate the various communal areas (swimming pool, park, petanque area, laundry, caretaker) and private areas.

As a result of the work carried out, 16 of the 19 homes in this first tranche were sold under the "Vente d'Immeuble à Rénover" format, allowing the amount of the work to be deducted from the property income. The three remaining lots are reserved (the lessee being the operator).

The operator has found in this market for second homes that it is preferable to sell "ready-to-live in" lots, as buyers are passing through and cannot manage the work remotely. This is what delayed the marketing of the first tranche.

In order to adapt its resale strategy, it has decided to launch the marketing of the 2nd tranche as of now. In order to help future investors to better project themselves once the work has been completed, 2 bastions of the second tranche have already been renovated by the operator to serve as "show homes".

The second phase will offer two models of units:

*Private surface area corresponds to the living area + 30% of the surface area of the annexes.

**Agency and notary fees included

Unit details and commercialization

The future buyers will be able to either come here to spend their holidays or to rent for a short period of time. The co-ownership syndicate is in charge of the short term rental. Weekly rental prices are determined according to the period of the year.

Depending on the price of the night, which varies according to the season and the occupancy rate, the expected return on the " Mistral " model sold 167 400 € deeds in hand would be as follows:

To obtain a net return of 5%, the investor must rent (gross) on average for a day at €75 or a week at €518.

The calculation assumptions used are as follows:

* Deduction of 30% of charges on gross rents (including concierge services, cleaning, etc.).

* Occupancy rate of 40% over the year, i.e. 146 days in the year or 21 weeks.

According to the operator, following this summer's confinement, not being a hotel, the demand for bookings was very strong on this program.

Currently, on the short-term rental sites during the summer season, the average price for a night is 100 €/night.

Zoom on the work

The renovation of the common areas and lots of the first phase, notably the swimming pool, will facilitate the sale of the second phase.

The works planned for the second phase are the renovation and fitting out with the extension of an awning for the 15 bastions MISTRAL and 3 bastions VAN GOGH for an amount of €652,012 including tax - i.e. €34,316 including tax per lot.?

Market price

The sale price of the transaction is below the market. There are few comparable offers, at around €150,000 for second homes in the commune of Saint Remy de Provence. The market corresponds mainly to pavilions of around 150 m² for prices between €400,000 and €800,000.

References of similar properties sold:

It should be noted that a housing unit from the first phase purchased at €97,000 (+ €32,000 in works) in 2018 is being resold for €178,500. See ad

Provisional schedule

Legal arrangement

The operation is carried out by SNC LES BASTIDONS DES ALPILLES, with a capital of 1,000 euros, registered in the LYON Trade and Companies Register under number 832 480 677, on 12/11/2019.

SAS REGENCY FINANCES 6, which will carry the bond issue, is wholly owned by REGENCY PARTICIPATIONS ET INVESTISSEMENTS.

The bond issue will be issued at an annual rate of 10% per annum for a period of 24 months. The bond issue may be amortized and repaid in the course of sales by the operator, with interest paid annually, but guaranteed for a minimum period of 6 months.

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

* First Demand Guarantee of the REGENCY PARTICIPATIONS AND INVESTMENTS.

* Mr. FICHARD's personal guarantee

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

SWOT

Operation budget

Financing structure

The need of 4 367 479 € corresponds to the total:

* Cost of production to date of 3 673 467 €

* Remaining work to be done 652 012 €

* Estimated financial costs of 42 000 €

Shareholder presentation

The REGENCY Group, headed by Mr. Christian FICHARD, is a Lyon-based, family-owned company with experience in property development, acquisition and renovation of old buildings and housing estates. For more than 40 years, the group has been developing qualitative operations for housing, offices, warehouses, alone or in co-promotion.

The REGENCY group is strongly active in the Lyon metropolitan area and the Rhône-Alpes region in :

* The construction of residential buildings, either new or undergoing major renovations, mainly in the Rhône-Alpes region (Lyon and the Lake Geneva basin).

* The construction of student residences in cities with a university vocation.

* The construction of tourist residences in regions with a strong tourist character (beautiful mountains, Alpilles, Ardèche, Périgord, Mediterranean coast).

* The "free builder" housing estate in the Lyon region.

* Tertiary operations (offices, warehouses) in the Lyon region.

For this operation, it has joined forces with a "sleeping partner" - the RÉGIS ROUSSEL DÉVELOPPEMENT group, a commercial operator in the Lyon region.

Mr. FICHARD declares, in his asset certificate dated 11 December 2020, net assets of approximately €1,500,000 held mainly through the shares of his holding company REGENCY Participations et Investissements, his main residence and a flat in 19th century Paris, held through an SCI.

See the achievements of the REGENCY group.