This investment opportunity involves the demolition of the current office block and development of residential units, comprising of 8x 3 bedroom houses, 1 x 2 bedroom house, 2x 2 bedroom flats and 1x1 bedroom flat. Collectively, the units will have an estimated GDV of £3,207,000, based on an average selling cost of £3,026 per m2 for the houses and £2,610 per m2 for the flats.
The proposed investment turnaround time is 18 months and the estimated return on investment is 32.57%. This means, for an investment of £10,000.00, JaeVee have forecast that the return will be in the region of £13,257.00, equating to a pre-tax profit of £3,257 in 18 months.
The development, which is a high quality contemporary scheme will be made up of 2 separate blocks. One of the blocks will comprise 8 x 3 bedroom houses (99m2) and the other will comprise 1 x 2 bedroom house (98m2), 2 x 2 bedroom flats (62m2) and 1 x 2 bedroom flat (61m2).
The houses are to be laid out over three levels. The main entrance is accessed on the middle storey of the property, which comprises bedroom with en-suite and stairs leading to the lower ground floor and first floor. The lower ground floor will comprise the kitchen, dining and living areas with access out to a private garden. The first floor will comprise a further 2 bedrooms and family bathroom.
The location, Tovil, is on the outskirts of the busy town of Maidstone, which is set in the home county of Kent. Nearby amenities and outstanding schools make this area popular with families. Transport links are strong in the area, as the train from Maidstone is around 1 hour into central London, which makes the location ideal for those who wish to commute into London. The site is located within a built up area, within the confines of the Maidstone urban boundary and as such can be considered to be within a sustainable location. The site is located close to transport links and shops and other local amenities.
The proposed exit strategy is to sell the units on the open market. The property will be marketed with local estate agents and we believe the target market for the houses are owner occupier young families and young professionals.
Based on sold comparables we expect to be able to sell the properties for the following prices:
With all JaeVee development projects, the SPV (in its role as the client) enters into a JCT 2016 design & build construction contract whereby the responsibility in delivering the project rests with the Principal Contractor.
The Principal Contractor has agreed to a fixed total contract sum of £1,521,450 (includes 5% contingencies) in delivering the project within a set time frame. In the case of this project, the time frame is 15 months from commencement of works.
As the Principal Contractor is holding the design and build contract, it will select the sub-contractors to assist in delivering the project. The SPV has the right to request copies of the JCT subcontractor contracts which will be taken care of by JaeVee's inhouse project manager who oversees the project from inception through to completion (the pre, during and post construction phases) assisting the property developer throughout.
As per CML regulations, a professional consultants certificate (also known as an architects certificate) will be issued after the building regulations completion certificate of works. This will provide a 6 year structural warranty which is a mandatory CML requirement for mortgage lenders to be able to lend on each dwelling.
The property developer also will be uploading updates to the JaeVee system throughout the duration of the project thus allowing investors to see the progress in real time.
|The following financials are calculated against our Sell For Profit model.|
|Gross Development Value||£3,207,000.00|
|Surveys & Searches||£10,000.00|
|Senior Debt Interest||£264,576.00|
|Sourcing Fee (0.0%)||£0.00|
|Equity Raise Fee (5%)||£30,035.00|
|Boost Fund (1%)||£6,000.00|
|Corporation Tax (19%)||-£91,846.95|
|Net Profit Margin||14.94%|
|Forecasted ROI (40% of Margin)||32.58%|
JaeVee is a trading name of Estateducation Ventures Ltd (FRN797322), which is an Appointed Representative of Prosper Capital LLP, which is authorised and regulated by the Financial Conduct Authority (FCA) (FRN453007). Estateducation Ventures Ltd is registered in England & Wales with company number 10172481. The registered office of the company is Studio 9 Netherconesford, 93-95 King Street, Norwich, NR1 1PW.
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