Real estate backed bridge loan financing in Ādaži
The Company was established in 2018 as a special purpose vehicle with the purpose to hold and later develop a real estate property located at Gaujas iela 33, Ādaži. The property consists of a 5,848 sqm land plot with current market value of EUR 360,000 and EUR 253,000 fast realization value.
The Company's related party has received a letter of intent from a large retail shop chain local representation for the construction of retail premises. Currently, in order to transition to a cooperation agreement, which would later become a lease agreement, between the developer and large retail shop chain, it is necessary to prepare the project. This includes development of a minimum part of the project, preparation of the building’s technical design, and technical designs for external utilities.
Therefore, the Company is seeking EUR 175,130 financing for 18 months to initiate development works of the related company’s real estate development project. The loan will carry a 10.08% annual interest rate (0.84% monthly) and it will be amortized at the end of the loan term by refinancing or from the proceeds of other projects developed by related companies. The loan will be secured with a first rank mortgage on a real estate with a market value of EUR 360,000 (LTV 48.7%). The project risk rate is B (85 out of 100).There are a number of factors that make lending to the Company an attractive opportunity and the main highlights are as follows:
- The loan is secured with a shared first rank mortgage on the land plot to be developed with the current value of EUR 360,000 (LTV 48.7%).
- The owner of the Company has a proven track record of successfully managing a private investment management company.
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