Crowdfunding Firm Eyes up Irish Real Estate
Crowdfunding has become the financial trend of the moment, a model helping to shake up everything from sending cash overseas to delivering loans to small businesses. London-based firm Property Partner plan to extend offer this investment vehicle to individuals seeking buy-to-let investments.
” Property investment is something that’s available to the few, rather than the many; our vision is to make it as accessible as a company stock, ” CEO Daniel Gandesha said.
Speaking to the TheJournal.ie at this week’s Web Summit, the startup’s founder repeatedly used the stock analogy to differentiate his company from both other crowdfunding prospects and old-fashioned property speculation.
Rather than having to pay significant deposits on loans, investors instead pay anything upwards of £50 to buy shares in a property, or in some cases whole blocks of apartments.
” Being able to diversify is really key and it also means you can invest through the property cycle, ” Gandesha said.
Imagine, here in Ireland, if you bought a property at one minute to midnight at the peak of the cycle … well, on our platform you can say I’m going to invest £10,000 a year and I’m going to invest in different areas. It’s not risk-free by any means, and we’re very upfront about those risks, but it’s a smart way to invest”.
Shares in a property are traded on an exchange – with the important caveat that there needs to be a willing buyer – which means investors don’t need to wait for a home to be sold outright to cash in on any price rises.
The average time to sell at market price currently stands at about 8 hours, Gandesha said, while shareholders also enjoy their cut of the rent. In return, the company takes 2% of any initial investment and a 10.5% share of the rental income to cover costs.
The vast bulk of its purchases so far have been in London, but unsurprisingly, given the city is Property Partner’s main source of bread and butter, Gandesha isn’t entertaining a “doomsday scenario” of the English capital suffering a repeat of Ireland’s catastrophic property crash.
That is despite the city recently being given the ignominious title of the world’s most overpriced property market. Each property is wrapped in its own ‘special-purpose vehicle’, a type of mini-company which leaves investments ring-fenced from Property Partners’ other assets in the event everything goes belly-up.
Since its launch in January, over 4,600 people have put up a combined £12 million (€16.7 million) through the site. It also has the financial backing of some big players, including Betfair co-founder and angel investor Ed Wray. Earlier this year it took on £5.2 million (€7.3 million at today’s rates) from a consortium including Index Ventures, which is also behind fintech companies such as TransferWise.
While Property Partner is already open to investors in Ireland, Gandesha said the company hasn’t been actively marketing outside the UK.
” My wife is Irish, she’s from Kilkenny, so it probably won’t be forever until we’re able to offer properties in Ireland, ” he said.
” We know investors have an appetite for properties all over the world, not just in the UK. What we want to build is a global stock exchange so any investor anywhere in the world can invest in properties across all of the interesting property cities “.
Article by +Roxanne James on behalf of Propertyshowrooms.com
UK Regional Real Estate Investment Exceeds London Volumes
For the first time in a year, investment in UK regions during Q3 exceeded London volumes with the North East seeing a whopping 89% year-on-year increase in commercial property investments
According to new research published by commercial property consultancy Lambert Smith Hampton (LSH), a total of £184m was invested in commercial real estate in North East England in the third quarter of this year, demonstrating a real sign of confidence in the UK’s region.
British investors dominated activity in the UK, ploughing £63.67m into the region, where the retail sector fared best with £68.3m of investment – 37% of the total volume invested.
Substantial increase in the volume of investment
There was a significant increase in the number of deals carried out in Q3 than in the same period of 2014 – with 24 deals closing compared with 9 last year – although the average transaction size dropped to £7.65m compared with £10.77m.
LSH director Bill Lynn, who heads the Newcastle office, said: ” The substantial increase in the volume of investment into the North East in the last quarter is clear evidence of the buoyancy and attractiveness of the region’s commercial property market “.
” We continue to see increasing investor confidence in the North East, particularly from UK investors, and we would expect this to continue into 2016 “.
Key deals for the quarter included Pradera UK’s acquisition of Hylton Riverside, an 11,241sqm retail warehouse in Sunderland, for £23.9m and Henderson Gravitas IV’s purchase of the Darlington retail space 3 to 7 High Row for £22.5m. Cobalt 12, a 9,197sqm office at Cobalt Business Park, also sold for £16.75m.
Across the UK, investment in the commercial property sector during the third quarter of 2015 reached £12.8bn, the research revealed. Despite representing a 23% decline on the previous quarter, investment for 2015 as a whole could just eclipse the record of £61.7bn set last year. Investment volumes in the UK for the year to date are currently at £48.5bn.
The latest edition of Lambert Smith Hampton’s UK Investment Transactions report also reveals that investment volume in the UK regions during Q3 exceeded London volumes for the first time in 12 months.
The firm said this helps to explain the reduction in the average lot size from £35m to £25m, and the fact that total transaction volume fell despite an 8% quarter-on-quarter rise in the number of deals.
Ezra Nahome, CEO of Lambert Smith Hampton, said: ” We continue to see high levels of interest among investors for UK commercial property “.
” Although there are signs that the market is starting to return to more sustainable levels of activity, we’re seeing a considerable stock of properties under offer, on the market or being prepared for sale. This indicates a dynamic end to 2015 and a very real prospect that investment will hit a new annual record this year “.
The report shows that UK institutions were ne dis-investors in commercial property for the first time in Q3 since mid-2012, with a number of key institutions appearing to rebalance their portfolios by cashing in within London whilst continuing to invest outside of the capital.
Article by +Roxanne James on behalf of Propertyshowrooms.com
Israel Seeks to Reposition Eilat and Tel Aviv as Tourist Hotspots
The launch of direct flights to Eilat and Tel Aviv in December will help reposition Israel as a winter sun and city break destination for the UK market, according to its head of tourism.
Monarch is to begin weekly services from Luton to Eilat every Thursday and three times a week to Tel Aviv, set to boost the popularity of Israel’s principal resort areas.
Speaking at the World Travel Market event in London, Amir Halevi, director general of the Israel Ministry of Tourism said: ” The city break is becoming very popular now with the rise of low-cost airlines but this year we have more than six times the number of weekly flights to Eilat from around Europe, so it’s becoming better known as a winter sun destination “.
Israel has seen an 8% increase in visitor number from the UK so far this year and is investing in a new international airport for Eilat due to open in 2016, as well as new hotel development and plans for a casino to be built on the site of the current airport.
The tourism ministry’s representative for the UK and Ireland, Naama Oryan-Kaplan, said: ” Eilat’s strongest USP is the fact that it’s a city, not just a beach resort. If someone is going scuba diving or for a family holiday, they can also enjoy the full city life with shopping, clubbing or family attractions “.
” We expect an increase in traffic as it becomes more accessible and we would hope to double the number of flights for next year. Eilat has been off the radar for a few years but people do know about it and we hope to use this awareness going forward. We think Eilat can offer a very good alternative to other winter destinations “.
The Dead Sea will also see a significant jump in hotel product with a further 5,000 rooms due to be added over the next five years, a trend that is emerging in other popular destinations in Israel. Eilat and the Dead Sea have both benefitted from an increase in domestic tourism as a consequence of the tensions between Israel and Turkey, which made many Israelis choose to holiday in their own home country rather than travelling abroad.
A number of international hotel brands are seeking to enter the market in Israel and a major trend has emerged that is seeing increased development of boutique hotel, predominantly in Tel Aviv and its surrounding area, according to HospitalityNet .
Israel is known for its high ranking among Middle Eastern countries in terms of human development, freedom of press, economic competitiveness and for embracing the cultural diversity of its population. However, the nation’s tumultuous history and difficult geo-political situation since its foundation in 1948 has not encouraged a perception of Israel as a holiday destination, despite its diverse and beautiful landscape.
As the government pushes Eilat and Tel Aviv forward in a bid to increase visitor numbers to Israel’s prime resort areas, there are more opportunities to invest in the hotel and hospitality sector for savvy property investors. Both cities have excellent infrastructures to support tourism combined with many unique attractions that hold a deep significance for visitors of all faiths from around the world.
Article by +Roxanne James on behalf of Propertyshowrooms.com
Business Partners
