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Braintree - Interim Equity

76-78 High Street, Braintree

£182,000

Funded

£149,000

Total Fund

Term (Months)
12
Projected Annualised Return
22%
Strategy
Development
Minimum Investment
£5,000
Login to invest
Interim Equity
Projected returns are an estimate. Returns may go down or up based on the future market value of the property and rental values achieved.

Key Points

  • 12 month term,  fixed target returns of 22% p.a.
  • High Street location, mixed use development
  • £5,000 minimum investment
This is an opportunity to invest in this mixed-use conversion of two high street retail units with offices to the rear, into 7 self-contained apartments and two A1/A2 units on the ground floor.

The main part of the property was built in the 17th Century of timber framed construction under a pitched tiled roof. There is a 15th Century wing to the rear and the shop fronts were added c19th Century. Consisting of part conversion and part new build, the completed development will provide:

  • 7x 1 Bed Apartments
  • 1,160 sq ft of retail space
  • 440 sq ft of ancillary basement
  • Shared external amenity space
CrowdLords is raising £149,000 of equity alongside £100,000 of Mezzanine to support a Senior Loan from Avamore Capital.

This project involves the refurbishment of the retail space, the removal of modern extensions to the rear and replacement with new build buildings.

Planning permission was granted on appeal on 2nd February 2018 under reference 18/00205/LBC to create 7x residential apartments with associated cycle storage and landscaping.

The approved design delivers 7x one bed apartments, but the developer is looking to change one of them into a two bed flat to enhance the value.

The developer has good experience and has been successfully delivering developments for many years.

Braintree is in a local authority district that includes Witham and Halstead, and the district population is growing above the national average. It also enjoys unemployment rates of 2.9% compared with 4.2% nationally.

The High Street sits just south of the George Yard Shopping Centre which is populated mostly by the national multiples. The High Street retailers include Specsavers, Timpsons, Costa Coffee and others.

The site has pedestrian access to the front from the High Street and vehicle access to the rear via St Michael’s Lane. The buildings currently occupy most of the site to the rear, but some of these will be demolished to create 175 sq. m of external amenity space.

The Developer has Head of Terms from two retailers for the Retail Space and is in discussions with local agents about the sale of the residential units.

Projected returns

Redeemable Class A Shares
  • Interim Equity
  • Fixed 12 month 
  • Target total returns of 22% p.a.*
  • Minimum investment: £5,000

*Please Note
-The target return will only be paid if the project generates sufficient profit.
-The Preferred Redeemable Class A Shares must be redeemed before any dividends or capital is paid to any other shareholders
-In order to be Redeemed at the Redemption Price the development needs to generate £32,780 of profit after tax which is just 22.24% of the forecast profit.
-These shares may only be redeemed once the Senior lender and the Mezzanine loan has been repaid. If the Redemption date is deferred or brought forward the Redemption Price increases to deliver an annualised return of 22% p.a.

Property name: 76-78 High Street

Address: Braintree

Property type: Flat - Purpose built

Property age: c17th Century plus later additions

Market type: Young professionals

Local Property Market

Braintree is a market town in the county of Essex, on the A120, mid-way between the regional centres of Colchester and Bishop's Stortford. Braintree is approximately 13 miles to the north of Chelmsford, which is accessible via the A131 and A130.

London Stansted International Airport is 15 miles to the west Braintree, close to the junction of the A120 and M11. Braintree has two railway stations, Braintree Town and Braintree Freeport, which provide services via Witham, into London Liverpool Street in approximately one hour. This fast rail accessibility to London drives occupier demand within Braintree. 

Braintree has a resident town population of approximately 42,000 and a local authority district population, including the neighbouring towns of Witham and Halstead, of 147,100 (2011 Census). This latter figure represents an increase of approximately 11.3% in the district population between 2001 and 2011, a level of growth higher than the 6.3% average for Essex. The district's unemployment rate as of June 2018 was below the national average of 4.2% at 2.9%.

Circa 70% of households in Braintree are owner occupiers, which is approximately 5% higher than the national average. Furthermore, the level of social housing in town is 4% lower than the national average (Source: Office of National Statistics).

 

Capital Investment

Purchase Price£475,000
Acquisition Costs£32,000
Legal & Professional Fees£129,610
Development Costs£427,000
Contingency Allowance£98,890
CrowdLords Fees£19,000
Total Investment£1,181,500
Less Senior Debt-£885,000
Less Mezzanine Debt-£100,000
TOTAL EQUITY£196,500
Developer Equity£47,500
Redeemable A Shares - Crowd Equity£149,000


 

Projected Capital Returns

Value Creation£1,505,000
Finance Costs£105,822
Sales Cost£27,750
CL Growth Fees£7,975
Corporation Tax£34,571
Net Profits After Tax£147,382
Share of Net Profits Paid £22.24%
Capital Return to Investors£32,780
 

Return Summary

Investment Period12 Months
Projected Total Return22.0%
Projected Annualised Return 22.0%

 

CrowdLords Development Analysis

The blocks shown in the "Risk Analysis" chart illustrate the CrowdLords Risk Rating. It shows where the investment lies on our internal Risk Return Profile. It is our opinion only and should not be taken as a recommendation. You should judge the Risk for yourself using the information provided and your own investigations. We rate Risk across 5 parameters and grade them as being A, B, C, D or E. A being lower Risk according to our criteria.
 

Market Sensitivity

We include a CrowdLords Risk Rating to illustrate where the investment lies on our Risk Return Profile.  Where risks are higher it is usual to expect a higher return and this is designed to aid quick comparisons only. It is our opinion only and should not be taken as a recommendation. You should judge the Risk for yourself using the information provided and your own investigations to form your own opinion.
We rate Risk across 5 parameters and grade them as being A, B, C, D or E. A being lower Risk. The five areas we grade are:

The Investment Period – the longer the period, the less the risk
 Macro location and market – has the area performed well historically
 Micro location – is the property in a good location for rental / sale
 Level of Development – the degree of development and the cost / time risks
 Track Record – the track record of the LandLord / Developer
We combine these into a weighted rating between A and E and show how the Risk / Return compares with what we would expect.

About the Sponsors

Grace Charles Property is a private property investment and development company specialising in the development of commercial and residential properties. We focus on maximising the potential of land and buildings and delivering aspirational living spaces that future generations will be proud to call home.
Grace Charles Property values are simple. To be straight talking, professional and focused on delivering results, excellence and integrity every step of the way when working with professionals such as architects, building contractors, banks and private investors. 

Ben Butkus 

Ben has a wealth of experience in the construction industry having worked on residential, commercial and mixed-use schemes as a project manager. Business experience ranges from acquisitions, structuring deals and working with private investors. 
Ben’s passion and drive comes from the ability to make a difference in the industry by working with vendors, investors, private companies and organisations to turn broken assets around and provide homes for people to live in. Ben’s flair for business, finance and property development is matched only by his passion and drive.

Raouf Belmouloud  

Raouf has a diverse experience within the corporate world with over 12 years in corporate banking & asset management. Since 2014 his main focus has been the residential and commercial property development sector. 
His main focus is working with motivated vendors to bring under utilised properties back into use in local communities such as Greenwich and surrounding areas. His extensive and long-term relationships with agents and landlords has managed to fast-track his progress.  
As a full time property investor himself he understands the importance of what truly makes an investment work as either a short or long term strategy. Whether it is a fast paced flip or a long term high yielding asset to hold onto it needs to match the investors requirements and risk appetite.

Property details

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