|Criteria||From a+ to d||Project rating|
Macro Location Analysis
EvoEstate Risk rating is of an informative nature only & can not be considered investment advice.
Loan To value
Original Loan Purpose and Security.
In our view this amendment strengthens the creditworthiness of the loan.
The reasons are:
We will now have the security of the Captains Avenue property valued at €350,000 plus the property to be acquired at 406 Clonard Road. The total value/cost is €850,000 and our loan at €500,000 represents an LTV ratio of 59%. The original loan had a Loan to Value of 64% so this amendment increases the level of security.
We have confirmation from the corporate entity who will purchase the finished properties that they will continue with the purchase of the properties at Captains Avenue and 406 Clonard Road notwithstanding the fact that the 2 apartments at 408 Clonard Road will no longer be part of the deal.
We have received confirmation from our valuers that the value of the Captain's Avenue site when complete (fully funded by the borrower but part of our security - work has started) will be €800,000 or €710,000 net of VAT. We also have received a valuation of 406 Clonard Road of €490,000. Therefore prior to any work starting on Clonard Road and after the borrower-funded work at Captain's Avenue is complete the security is worth €1.2m affording a comfortable LTV of 41%.
As per the original credit paper, the loan will be repaid in increments as the first properties are sold to the corporate purchaser. It was originally likely that the loan would be paid in full on the sale or the 4th property to sell. With the new lower loan balance the loan is now likely to be repaid in full once the 3rd property (of 6 now) sells - that will be the original house at 406 Clonard Road. The construction of the remaining 3 properties will be funded through the sales proceeds of the earlier properties remaining after our loan has been repaid.
Original Clonard Road Security – 406 and 408
The property not now being acquired is the small rear yard to the left of the laneway. The remainder of the area inside the red line represents 406 Clonard Road and that is still being acquired.
New Clonard Security - 406
We again recommend this loan which is now commercially stronger than before. The property that is not being purchased was not a central part of the original loan as we had planned to have been repaid before those properties came on stream. Now with a smaller loan, we will be repaid earlier from a stronger overall security base.
See below for a revised summary of the loan;
Mourneview D12 Limited (the “Borrower”). (100%-owned subsidiary of Latinus Limited)
A first fixed charge over the property owned by the company listed at 1 above and a first fixed charge over the properties to be acquired by the company listed at 2 above.
A first charge over a bank account to be established by the company with the loan facilitator into which the proceeds of sales of assets comprised in the properties 1 and 2 will be deposited.
A first floating charge over the assets of the borrower.
The guarantee of the parent company Latinus Limited for an amount of €200,000
Gross Development Value
7.50% per annum (paid on completion)
Acquisition and Development Loan
Loan to Cost / LTC
18 months (9 month’s minimum)