Loan 8% to land company with low risk profile
An established land bank company offers a unique opportunity for investors to participate in its financing structure through a subordinated loan. The company purchases strategically located land with the intention of reselling it after obtaining planning permission or giving it on a long lease/property to sister companies within the group. All transactions are made at a minimum of the all-in cost of the land mine, plus a margin of 10%.
Loan details
Amount: €500,000 to €1,500,000
Term: 4 years (01/07/2025 to 30/06/2029)
Interest rate: 8% annually, paid monthly (from 01/08/2025)
Subordination: Subordinated to bank land financing, but before intra-group or third party construction financing
Early repayment:
Within the first 3 years: subject to reinvestment fee of 6 months interest
After 3 years: free of charge
Late payment: fixed compensation of 10% + statutory interest on arrears
Security:
Total subordinated loans limited to the equity of the company
Independent valuation of land
Option right in case of default 6 months after maturity: purchase of shares at corrected equity -25%
Additional benefits for the investor
Right of purchase discount: Right to purchase apartments from the group at a 5% discount, in pre-sale or after completion
Limited cost structure within the land company: No overhead or hidden costs; only land and company related expenses allowed
Why invest?
Solid legal structure
Real guarantees through controlled capital accumulation
Monthly cash flow through interest payments
Potential for real estate discount
- Location
- Antwerpen
- Real estate included
- No
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