BOUDOURIS
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Investor Models

Investment Vehicle Mechanics

A.  Investor/s participate in the profits in the development at a 50% quantum; 50/50 split.

B.  Their funds are pooled into a SPV (Special Purpose Vehicle) and securitised by a 1st bond over the property along with their directorship and pro-rata shareholding in the new company, thereby giving them total comfort in their investment contribution being secured.

C.  Their percentage of contribution is proportioned in accordance with their contribution over the entire project, against the 50% investor profit split.

D.  The costs/drawdowns are validated against the professional quantity surveyors oversight, who will manage the project costs in accordance with his bill of quantities report and always be done on a cost to complete basis, thus ensuring that no funds are ever mismanaged and most importantly that the product is delivered in accordance with the specified finish, complete and on time.

E.  Two different investment models are available or a combination of the two. Build to sell or build to rent out. In terms of both models the 50/50 split would apply.

F.  On the build to keep model. The units will be managed in house by the management company, rentals are screened by the attorney firm and the tenants are placed accordingly. The levy is managed and the day to day running’s of the body corporate are in house, along with security, garden services, maintenance, etc.

G.  In respect of valuating the developments that fall into the buy to let category, we acquire a minimum of three locally relevant estate agents valuations along with the use of SAPTG (South African Property Transfer Guide) and Lightstone reports and aggregate the findings to establish a true and actual market valuation of the development in order to safeguard the interests of the investor and development partner.

H.  Opportunities are sought that are ripe to begin the construction phase of the project, so as to avoid long durations of waiting for council approval of development land.

I.  The construction timeline i.e. investment horizon is very dependent on the size of the project and this information is provided on a project by project basis; however the goal is to be done within a period of 10 to 12 months.

J.  The investment funds are managed through stringent means to ensure above and beyond doubt that the investors best interests are always kept in strict compliance with their expectations. The attorney will only release payments that are in line with the project costings and the mandate of the project which is conveyed via the quantity surveyors reports and controls.

K.  The journey is important to all parties vested in the project and more than anything, will be dealt with integrity, honesty, trust and accountability. The goal is to keep growing the business and its strategic partners who are its investors.

 

GENERAL EXAMPLE

2 Bed 2 Bath units of 75 SQm’s

Total Development Selling Price: R40.264.000,00

Total Development Cost: R33.485.000,00

Profit: R6.779.000,00 (50% to investors – R3.389.500,000)

Value split across units: R36.874.500,00 / 56 units: R658.473,21 per unit.

Market Value per unit on completion: R719.000,00 (Saving R60.526,79 / unit).

Rental Yield per unit: R7.200,00

Gross Annual Yield: R7.200,00 X 12 = R86.400,00 / R658.473,21 X 100 = 13%

The track record will speak for itself and the yields will only keep you investing more and more.

As a partner in the business, its drive is to see all parties benefit equally and to keep a cycle of win win for all involved. Our partnership will breed mutual and continual success.

Get in touch

contacts
+27 (0) 861 534 229 (Office)
+27 (0) 86 502 5612 (Fax)
info@boudouris.com
Lonehill, South Africa
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