propfund germany 2 presentation v2
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Share in Germany’s No.1
Residential Property Portfolio 2012
WHY PUT ALL YOUR MONEY INTO ONE PROPERTY
when you can join together with like minded investors
and purchase the whole building at a lower price
with higher returns.
Introduction
German Property Market
Properties acquired 2011
Portfolio description
Investment features
Investment model
ROI Projections
Propfund’s role
EURIX Group
Getting started
Agenda
Share in Germany’s No.1 Residential Property Portfolio 2012
Where an individual investor could purchase one
apartment in Germany for €140,000 with a rental
yield of 5.5% and with a 60% mortgage, Propfund
Germany would bring all these investors together
to purchase the entire building resulting in the
same apartment being purchased for €100,000
with a rental yield of 8% with an 80% mortgage.
With this model Propfund investors make a lot
more money with little or no involvement
compared to investing privately themselves.
The idea is very simple…
Share in Germany’s No.1 Residential Property Portfolio 2012
Forecasted dividend of 7-10% per year. 170% return in 10 years time
Invest €50K in Germany and Make 170% ROIYour Exit Amount: €135,000
Returns
2012Share in Germany’s No.1 Residential Property Portfolio
German property market
German Real estate market is very active with
institutional investorsEconomic growth in 2011 – 3% GDPUnemployment levels are fallingInvestor confidence very strongHigh rental occupancy levels in major cities84% rental occupancy in BerlinProperty Prices and Rents continue to riseNo.1 residential property investment market in the world
Germany – The Worlds most stable property economy
Share in Germany’s No.1 Residential Property Portfolio 2012
“German residential sector is regarded as a secure investment” CBRE
What the media says in 2012…
Share in Germany’s No.1 Residential Property Portfolio
“Apartment costs up by around 8% in 2011” GSW Immobilien
“The most dynamic rent market is in Berlin, where prices rose by 9%” Jones Lang LaSalle
“Housing prices rose by 5.5% last year— more than twice as much as in 2010.” TD International
“Analysts expect prices for German real estate company shares to rise by 5-15% over the next twelve months”
Dr. Zitelmann
2012
Housing price development is healthy
Share in Germany’s No.1 Residential Property Portfolio
DB Research expects a further rise in the price of housing in Germany. Prices for houses should rise by 3% annually until 2015, condominiums by even more. No talk of a bubble: “Historically and in terms of disposable income, housing remains attractively valued and thus, even with price increases of 5% per year through 2015, there is no threat of overheating.”
Over the long term, prices are not likely to go through the roof because of both the regulatory environment, which has a moderating effect on rent, and the demographic trend, which, “in less than ten years,” will have a negative influence on prices.
2012
Berlin housing market
Share in Germany’s No.1 Residential Property Portfolio
Properties are valued as a multiple of the rental income Property Prices and Rents are low in Berlin and rising Berlin is a population of tenants – 84% of Berliners rent
Germany’s capital city has huge potential for growth!
2012
Properties acquired 2011
Propfund Germany 1- Subscribed in 2011
Share in Germany’s No.1 Residential Property Portfolio
With the combined equity of 80 investors in 2011, Propfund 1 acquired 6 portfolios totalling 240 units, bringing the total acquisitions to €12,602,500 with an exciting rental yield of 9,4%
240 properties & 27 car spaces Portfolios purchased for €12,602,500 Current portfolio value (12.5) €14,800,000 Acquired 20% below current market value External bank financing – 85% LTVAverage apartment price €53,072 (€744/sqm) Rental income – €1,187,233Rental yield – 9.4%Rental Occupancy 98%Cash surplus pa – €287,670Profit 7.4% pa equity invested
2012
Don’t miss your chance in 2012!
PROPFUND GERMANY 2 Open for investments, April 2012
Residential apartment blocksOver 500 units worth over €30,mil8% average rental yields Low purchase prices – 12.5 times the annual rentNo renovation requiredAll buildings tenantedImmediate income generating portfolios
Portfolio Description
Share in Germany’s No.1 Residential Property Portfolio 2012
Invest via a SIPP or as a Private investorInvest from €30,000German Federal Financial Authority approvedLow purchase prices – 12.5 times the annual rent€10,mil in Private Equity and €20,mil in bank financingReturns paid to investors yearly – forecast 7%-10% per annumInvestors can expect to earn 170% ROI over 10 yearsSafe and secure investment
Investment Features
Share in Germany’s No.1 Residential Property Portfolio 2012
Investment model & ROI projections
3 SIMPLE STAGESStage 1: Purchase the property
•Apartment block for sale €1,000,000 (10 apartments at €100,000/apt)
•If purchased individually €140,000/apt
•Annual rental income: €80,000 (Purchase factor is 12.5 times annual rental income)
•Investment based on a purchase price of €1,000,000 plus 10% closing costs.
•80% bank financing + 20% private equity
Stage 2: Manage the portfolio each year
•Collect the annual rent: €80,000 (increase by approx 2%-3% per annum - €100,000 after 10 years)
•Manage all the annual costs: €59,000 per annum
•Generate the annual cash surplus: €21,000 (grows as rent increases per annum)
•Shareholder payout each year = minimum forecast €21,000= 7% of the €300,000 private equityStage 3: Resell the property after 10 years
•2%-3% increase in rent pa = 20%-30% increase in Property value over 10 years
•Mortgage balance reduced by approx. 20% over 10 years
•Property resale value: €1,300,000 (strategy is to resale the portfolio for a price 13 times annual rent)
•Profit from sale of the portfolio: €300,000 after all closing costs
Investment Model
Share in Germany’s No.1 Residential Property Portfolio
100% ROI
in 10 yrs.
Purchase
Factor 12.5
7% ROI
Each year
(€210,000 over 10 years = 70% ROI)
2012
+ (€300,000 = 100% ROI) = (€510,000 = 170% ROI)
Creating wealth for investors
Share in Germany’s No.1 Residential Property Portfolio
Invest €50,000Earn an average dividend of €3,500 per year
for 10 years. (7%pa)PLUS €50,000 lump sum after 10 yearsPLUS your initial investment backThat’s a total of €135,000!
2012
Investment examples
Share in Germany’s No.1 Residential Property Portfolio 2012
To set up the legal construction to enable multiple investors in to invest togetherTo obtain approval from the German regulator to offer the fundTo raise the private equity from multiple private investors and SIPPsTo source, negotiate, and purchase the propertiesTo complete all the due diligence and organise the bank financingTo manage all the properties and collect the rent each monthTo co-ordinate any maintenance or refurbishment requiredTo perform annual tenant reviews and increase the income from the portfolio each year.To sell all the properties on completion of the fundTo pay annual dividends to investors and profits from the sale of the portfolio after 10 years
Role of Propfund
Share in Germany’s No.1 Residential Property Portfolio 2012
The EURIX Group
Real estate Investment since 1996Founded by Marco Knoblauch and Detlef Martin
– approx 20 staffHead office Berlin. Offices in London, Dublin & ZurichExpertise in Property Acquisition, Investment and Asset Management3 Syndicated Property Funds under managementOver 1000 properties under management in Berlin. (300 units Group
owned)Real Estate partner of Germany’s largest network of Financial AdvisorsMember of the German Real Estate Association
EURIX Group
Propfund Germany is part of the EURIX Group
2012Share in Germany’s No.1 Residential Property Portfolio
EURIX Group
2012Share in Germany’s No.1 Residential Property Portfolio
Summary…By investing in Propfund Germany 2, you benefit from:
Share in Germany’s No.1 Residential Property Portfolio
Lower Purchase PricesBetter finance conditionsHigher rental yieldsLower riskNo hassle, Fully Managed investmentMultiple Investment options
2012
Excellent Returns! Forecasted dividend of 7-10% per year. 170% return in 10 years time
Invest €50K in Germany and Make 170% ROI Your Exit Amount: €135,000
Joining the Fund
Read a copy of the investment prospectus. Decide the amount you would like to invest.
Complete the Investment Instruction and return this to your advisor.
The Trustee signs the necessary documents and returns copies of these to the investor.
Once you have received the documents you need to transfer the funds to the Propfund bank account.
Receipt of funds is first confirmed by email. Once the 14 days “cooling off” period has expired, confirmation of funds along with a share certificate is sent to you by post, this completes the investment process.
Getting Started
2012Share in Germany’s No.1 Residential Property Portfolio
Thank You
Propfund Germany 2 GmbH & Co. KGFriedrichstraße 82,10117 Berlin-Mitte
T: +49 30 499 05 09 50 E: [email protected]
2012Share in Germany’s No.1 Residential Property Portfolio