Invest with us as your partners
How does it work?
- We create a limited company (“spv”) with 1,200 £1 Shares
- We are offering 400 Bonds of £10,000 each (or £4 million in total)
- Each Bond will be for up to 5 years and pay base less 1% per annum until repayment
- Each Bond will come with a share in the spv
- The money from the bonds will be used to purchase residential properties for the spv. We will manage that portfolio as your Partners and as Owners. So our interests will be aligned with yours.
- As monies come in we will commence purchasing properties but when the full £4 million is reached then the spv will be closed and the portfolio ringfenced. The shares will not be further diluted.
- The portfolio will be used to repay the bond holders within 5 years.
- The bondholder is then left with a share in the spv which can be held for themselves and their families or sold.
- The value of that share will rise in part because rents and capital values should rise but in part because the prime objective of the portfolio will be to repay the mortgage debt used to repay bondholders. Within a period of hopefully no more than 15 to 20 years the spv should be debt free. No one can foretell the future but you can see how valuable that asset would be especially as it is an asset class that can be renewed and operate into the foreseeable future.
What are the advantages of this model
The most important advantage is that our interests are fully aligned with yours. We only succeed if you do. We are both in this together.
- As Partners and Owners in this venture we want to ensure we get the best possible properties and operate them in the most efficient way. Our prime objective will be to pay back your loan as a bondholder because it is only then we get the real benefit from this Investment. Until that is repaid we do not share in the profits but only get a letting fee on rents. We do not take any form of fee for putting the portfolio together or on its value, as is usual.
- If there is a problem with a property it is not your problem it is our problem. And we will do our best to solve it as Owners not Agents.
In Addition
- You will know each property in the Portfolio. You can visit them. You will get details of their performance. You may only have a small share in the portfolio, but you will feel a real sense of Ownership.
- This is a model that can be replicated many times and offer multiple opportunities for Investors to invest.
- Most importantly you bear almost no liability for the actions of the Company as a minor shareholder and not a Director. By contrast as the Owner of a Property you are totally responsible for everything that happens at the Property and any claims made. You might think your Agents are liable but they are not. They are your Agents but ultimately you are responsible. So if there is an accident, a fire, a claim by the local authority, a claim by the new regulator to be appointed when every property has to be licensed or any other claims made against the Owner you are in the firing line. That is not the case as a minority shareholder in our Company.
Why this model potentially offers the same (or better) returns and benefits as a Buy To Let but with a fraction of the risk.
Our aim is to repay you within 5 years by remortgaging, out of cash flow or if necessary sales. We normally do a first remortgage for 70% so you are pretty certain to get at least that back within say a year of the portfolio being finalised. Our experience shows the balance can then be paid back from cashflow or further remortgages or the odd sale. Obviously that cannot be guaranteed and depends on market conditions but if they become adverse you will face the same problem with a Buy to Let. The difference is there you are on your own with the total risk.
If your loan is repaid then this is an Investment with no money in where all future returns are simply a bonus
We will be looking to create high yield portfolios. Normally our gross returns are between 10 and 14% and increase as time goes by and rents rise often to much higher yields. So fast forward 10 years and imagine the portfolio is worth say £8 million with an income of say 10% on that value so £800,000. We would expect potential cash for dividends to be in the region of 30% so say £240,000. This would mean your share gets a dividend of £200 so 5% but on top of that you have a share in the underlying value of the portfolio. Our aim will be to be paying down any bank loans. We will have needed maximum £4,000,000 to repay bondholders so the bank debt by then should be something like £2 million which means an equity of £6 million or £5,000 per share. Obviously these are figures that you could say are plucked from the air but ask yourselves this. Would you expect a property to double in value over 10 years? Is that realistic? our experience shows it is because properties we purchased 5 years ago for £40,000 are now worth £80,000.
You can transfer your shares to family members or other third parties. So if your aim in buying a Buy to Let is to create wealth in later years for you and / or your family you can do that with us
We will be creating a private market for Investors to market their shares to each other. So we hope to be able to offer you the ability to sell your shares privately. You can of course always sell them yourselves so long as you comply with FCA rules
In addition this Investment does not require a large up front commitment or your being responsible alone for the Properties purchased. Instead with a minimum Investment of £10,000 you can purchase as many or as few shares as you are comfortable with.
We are the right team to build these portfolios for both of us
How can confidently make this assertion? Because for the last 10 years and in particular the last 5 years we have spent our time building 10 existing portfolios for other Investors. We know this market inside out and the proof of the pudding is in looking at the portfolios we have already created and are operating today. See our About information for more on this. Or meet with us if you want to see in person what we do.
We are not sales people making our money by slick marketing. We are professional operators of residential properties dealing day in and day out with all aspects of this business from finding the right properties in the right areas and then operating them successfully. That includes all aspects of the building works and maintenance of the properties. We are not frightened by the new regulatory regime because we know how to master regulatory rules and operate within them.
Don’t just take our word for it.
Browse through genuine reviews left by current and previous tenants.
