People dream of making money from investments but with the unpredictability of stocks and shares, many have started looking at alternative markets. Acquisition of alternative commercial assets such as student accommodation, Luxury Hotels and more recently care homes have come in favour with many international buyers.
Generally speaking, the rate of return is higher through an alternative investment than more traditional routes, in some cases this can be provided at a fixed rate for a pre-determined term. Not only does this provide the security of a tangible asset but also the confidence of knowing that you will receive set returns for a set term.
There are opportunities to acquire both off-plan and existing projects, each of which provide different benefits.
With off-plan projects, you will be able to purchase for a lower rate than the property’s final value. Using the example of an off-plan hotel, the valuation will increase throughout the build stage, on completion, and once amenities have been completed. This further increases once open and operational, as the occupancy rates increase this then supports valuations by enhancing the operational performance of the facility. As our developers are keen to get projects out of the ground, developer-funding options with 0% interest are not uncommon to assist with purchases. The loan/mortgage repayments are then serviced by the annual return of your asset and thus allowing individuals to leverage themselves without any further exposure. It is also worth thoroughly investigating any feasibility studies and valuations, which should be provided by your selling agents. When receiving these, it is expected that they would be from a reputable, independent third party and contain thorough reports into the project, the industry, its locality, and other local factors such as competition and operational sustainability.
Although completed projects can be more expensive, they do offer a more immediate and secure route of income, as such projects would be able to provide actual day one operational returns, giving investors a full transparent view of how the project has already been operating and how feasible the rate of return is.
What to look for in the alternative market.
Off-Plan or Completed? – Depending on what you are looking for in a project will change your opinion on this. As previously stated, there are advantages to both.
Credibility – Check through all the parties involved in the development and operation of the projects and take a look into their backgrounds to see how successful they have been in the past.
Fixed return rates & period – Find out as much as you can about the returns suggested in the marketing material, see if they are fixed or projections based on feasibility studies. A fixed return would show the developer’s commitment to the project and also many are now supporting further to assist with your exist strategy and agreeing to buyback at enhanced % above your purchase price.
Through working with international property developers, MBi have been able to ensure that our projects tick all of the relevant boxes. We ensure that our projects provide a fixed rate of return for a set period and all completed developments provide full operational figures and any off-plan projects come complete with in depth feasibility studies and valuations from reputable sources.
We have used our knowledge to construct our own projects within the market that are sustainable in difficult economic times and provide individuals with opportunities to make their money work for them.
Whether you’re just thinking about diversifying your portfolio within the alternative investment market or are a well-informed sophisticated investor, MBi Consulting (UK) Ltd can provide a selection of comprehensive projects that may well be of interest. For information on some of the best products in the market contact MBi today for a free consultation on +44 (0)1422 835 179 or email info@mbiconsultingltd.com.
For more information on MBi Consulting (UK) Ltd and the work they do please visit www.mbiconsultingltd.com.
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