Deepcut Office to Flat Conversions FAQ
What experience do the developers have?
This is a new team made up of experienced individuals. Ben is successful entrepreneur and experienced CFO who has developed and managed a portfolio of Buy-to-Lets and he has recruited Richard and Colin to bring the Development experience.
Richard is currently on contract as an Operations Director, concurrently managing a number of "Office to Resi" conversions across the South East with a total GDV of more than £40m. Whilst Colin has more than 20 years as a Cost & Project Manager and a Chartered Surveyor.
On completion of the project, who is the intended market for the flats?
The flats will be designed to appeal to first time buyers working locally in Guildford, Bracknell, Camberley or Woking or even commuting into London. They will probably be young professionals or couples.
How long do the developers expect planning permission to take?
They expect the Permitted Development rights to be granted during the second week in October. If for some reason they are denied then the purchase will not proceed.
Planning permission for the 7th flat is expected to take 8 weeks from submission but professional preparations can be started whilst a decision is pending.
How confident are the developers in completing the conversion in 12 months?
The team consider this to be a relatively straight forward development as the property is ideal for conversion. Most of the work required is internal except for the addition of the 7th Flat in the roof space and the replacement of the retail frontage. They will start marketing the units during construction and local agents expect them to sell 'off-plan'.
What would my return be if I invested £20,000?
If you invested £20,000 your projected total return will depend on whether Planning Permission is granted for the 7th Flat or not.
If it is, then your projected total return would be £24,100 including your initial investment. However, if Planning Permission is not granted then 17% of your initial investment will be returned (£3,400) and the remaining £16,600 is projected to deliver a total return of £19,920 (20%) giving you a total return of £23,320.
These are only projected returns. The actual return will be based on the profitability of the project and investors receive 18% of the net profits after tax.
In reality the annualised return will be reliant on how long the project takes to complete as well as the final sales price and the costs of development. The developer has been conservative by allowing a 12 month development plan and as usual, has not considered any market growth during the development period. There is however a minimum preferred return of 15% p.a.
When will returns be paid and when do I get my money back?
Your initial investment along with your share of the net profits will be paid once the last flats have been sold and completed. The target date for this is October 2017.
Why have the developers decided to use Crowdfunding for this project?
Ben has big ambitions for his property development business and is already working on his next project. As such he wishes to spread his capital across a number of projects to enable him to run a number of projects simultaneously. Crowdfunding enables him to do this.
He sees CrowdLords as an opportunity to build a base of loyal, satisfied investors to join him on his journey - sharing the risks and the rewards of each project. That's why he has started with a relatively small and straight forward project where he feels confident he can over deliver on returns in less time than promised.
What are the planned sales value for each flat?
The sales price has been taken from a Savills estimate based on the size and the local market. One beds are currently valued at between £180,000 and £200,000 and the two bed flats range from £220,000 to £240,000.
What would they do if the market changes and they can't sell the flats?
There is such a shortage of flats in this area that the Developer believes that this is very unlikely. However, it is important to have a fall back position and projected yields, at market rates are currently around 5% and so there is always the possibility of refinancing and holding onto the flats until the market recovers.
It is the Independent Director's responsibility to involve Shareholders in any change of plan and it would require the agreement of 75% of Shareholders.
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