Propfund 2 presentation v4 web

Share in Germany’s No.1

Residential Property Portfolio 2012

WHY PUT ALL YOUR MONEY INTO ONE PROPERTY

when you can join together with like minded investors

and purchase the whole building at a lower price

with higher returns.

Introduction

German Property Market

Properties acquired 2011

Portfolio description

Investment features

Investment model

ROI Projections

Propfund’s role EURIX Group

Getting started

Agenda

Share in Germany’s No.1 Residential Property Portfolio 2012

Where an individual investor could purchase one

apartment in Germany for €140,000 with a rental

yield of 5.5% and with a 60% mortgage, Propfund

Germany would bring all these investors together

to purchase the entire building resulting in the

same apartment being purchased for €100,000

with a rental yield of 8% with an 80% mortgage.

With this model Propfund investors make a lot

more money with little or no involvement

compared to investing privately themselves.

The idea is very simple…


Forecasted dividend of 7-10% per year.

170% return in 10 years time

Invest €50K in Germany and Make 170% ROI

Your Exit Amount: €135,000

Returns

2012 Share in Germany’s No.1 Residential Property Portfolio

German property market

German Real estate market is very active with

institutional investors

Economic growth in 2011 – 3% GDP

Unemployment levels are falling

Investor confidence very strong

High rental occupancy levels in major cities

84% rental occupancy in Berlin

Property Prices and Rents continue to rise

No.1 residential property investment market in the world

Germany – The Worlds most stable property economy


“German residential sector is regarded as a secure investment” CBRE

What the media says in 2012…

Share in Germany’s No.1 Residential Property Portfolio

“Apartment costs up by around 8% in 2011” GSW Immobilien

“The most dynamic rent market is in Berlin, where prices rose by 9%”

Jones Lang LaSalle

“Housing prices rose by 5.5% last year— more than twice as much

as in 2010.” TD International

“Analysts expect prices for German real estate company shares to

rise by 5-15% over the next twelve months” Dr. Zitelmann

2012

Housing price development is healthy


DB Research expects a further rise in the price

of housing in Germany. Prices for houses should

rise by 3% annually until 2015, condominiums by

even more. No talk of a bubble: “Historically and

in terms of disposable income, housing remains

attractively valued and thus, even with price

increases of 5% per year through 2015, there is

no threat of overheating.”

Over the long term, prices are not likely to go

through the roof because of both the regulatory

environment, which has a moderating effect on

rent, and the demographic trend, which, “in less

than ten years,” will have a negative influence on

prices.

2012

Berlin housing market


Properties are valued as a multiple of the rental income

Property Prices and Rents are low in Berlin and rising

Berlin is a population of tenants – 84% of Berliners rent

Germany’s capital city has huge potential for growth!

2012

Properties acquired 2011

Propfund Germany 1- Subscribed in 2011


With the equity Propfund raised in 2011 we

acquired

6 portfolios totalling 240 units, bringing the

total

acquisitions to €12,737,500 with an

exciting

rental yield of 9,3%

240 properties & 27 car spaces

Portfolios purchased for €12,737,500

Current portfolio value (12.5)

€14,800,000

Acquired 20% below current market

value

External bank financing – 84% LTV

Average apartment price €53,072

(€744/sqm)

Rental income – €1,184,439

Rental yield – 9.3%

Rental Occupancy 98%

Cash surplus pa – €266,701

Profit 7.4% pa equity invested

With the combined equity of 80 investors in 2011, Propfund 1

acquired 6 portfolios totalling 240 units, bringing the total

acquisitions to €12,602,500 with an exciting rental yield of 9,4%

240 properties & 27 car spaces

Portfolios purchased for €12,602,500

Current portfolio value (12.5) €14,800,000

Acquired 20% below current market value

External bank financing – 85% LTV

Average apartment price €53,072 (€744/sqm)

Rental income – €1,187,233

Rental yield – 9.4%

Rental Occupancy 98%

Cash surplus pa – €287,670

Profit 7.4% pa equity invested

2012

Don’t miss your chance in 2012!

PROPFUND GERMANY 2 Open for investments, April 2012

Residential apartment blocks

Over 500 units worth over €30,mil

8% average rental yields

Low purchase prices – 12.5 times the annual rent

No renovation required

All buildings tenanted

Immediate income generating portfolios

Portfolio Description


Invest via a SIPP or as a Private investor

Invest from €30,000

German Federal Financial Authority approved

Low purchase prices – 12.5 times the annual rent

€10,mil in Private Equity and €20,mil in bank financing

Returns paid to investors yearly – forecast 7%-10% per annum

Investors can expect to earn 170% ROI over 10 years

Safe and secure investment

Investment Features


Investment model & ROI projections

Key Performance indicators


1. Purchase Prices: Average 12.5 times the annual rental

income – average 8% rental yields.

2. Profitable from Day 1: Properties show a 7% profit in

the first year after all costs based on our cost model.

3. Rental & Property increases: Forecast is based on

increasing the rents and the value of the portfolio by

2,5% per year for 10 years.

4. Resale Prices: Average 13 times the annual rental

income – average 7.7% rental yields.

2012

3 SIMPLE STAGES Stage 1: Purchase the property

• Apartment block for sale €1,000,000 (10 apartments at €100,000/apt)

• If purchased individually €140,000/apt

• Annual rental income: €80,000 (Purchase factor is 12.5 times annual rental income)

• Investment based on a purchase price of €1,000,000 plus 10% closing costs.

• 80% bank financing + 20% private equity

Stage 2: Manage the portfolio each year

• Collect the annual rent: €80,000 (increase by approx. 2%-3% per annum - €100,000 after 10 years)

• Manage all the annual costs: €59,000 per annum

• Generate the annual cash surplus: €21,000 (grows as rent increases per annum)

• Shareholder payout each year = minimum forecast €21,000= 7% of the €300,000 private equity

Stage 3: Resell the property after 10 years • 2%-3% increase in rent pa = 20%-30% increase in Property value over 10 years

• Mortgage balance reduced by approx. 20% over 10 years

• Property resale value: €1,300,000 (strategy is to resale the portfolio for a price 13 times annual rent)

• Profit from sale of the portfolio: €300,000 after all closing costs

Investment Model


100% ROI

in 10 yrs.

Purchase

Factor 12.5

7% ROI

Each year

(€210,000 over 10 years = 70% ROI)

2012

+ (€300,000 = 100% ROI) = (€510,000 = 170% ROI)

ROI Forecast – €100,000 (Before tax in Germany)


Invest €100,000

Earn an average dividend of €7,000 per year

for 10 years. (7%pa)

PLUS €100,000 lump sum after 10 years

PLUS your initial investment back

That’s a total of €270,000!

2012

Negative Forecast- 0% increase in rent and property values per annum

Invest 100,000€ year 1 & 2 year 1 year 2 year 3 year 4 year 5 year 6 year 7 year 8 year 9 year 10 TOTAL

Net payout after tax 7,000 € 7,000 € 4,500 € 3,908 € 3,581 € 3,530 € 3,727 € 3,922 € 4,115 € 5,056 € 5,994 € 52,334 €

Net payout after tax (%) 7.00% 7.00% 4.50% 3.91% 3.58% 3.53% 3.73% 3.92% 4.12% 5.06% 5.99% 52.33%

Actual Forecast- 2,5% increase in rent and property values per annum







Positive Forecast- 5% increase in rent and property values per annum

Total net annual payments over 10 years 52.3% 52,334 €

Average dividend net pay out per year 5.2% 5,230 €

Plus lump sum after 10 years 25% 25,156 €

Plus your initial investment back 100% 100,000 €

That’s a total return of: 177% ( 177,490 € )











Investment examples


To set up the legal construction to enable multiple

investors in to invest together

To obtain approval from the German regulator to

offer the fund

To raise the private equity from multiple private

investors and SIPPs

To source, negotiate, and purchase the properties

To complete all the due diligence and organise the

bank financing

To manage all the properties and collect the rent

each month

To co-ordinate any maintenance or refurbishment

required

To perform annual tenant reviews and increase the

income from the portfolio each year.

To sell all the properties on completion of the fund

To pay annual dividends to investors and profits from

the sale of the portfolio after 10 years

Role of Propfund


The EURIX Group

Real estate Investment since 1996

Founded by Marco Knoblauch and Detlef Martin

– approx 20 staff

Head office Berlin. Offices in London, Dublin & Zurich

Expertise in Property Acquisition, Investment and Asset Management

3 Syndicated Property Funds under management

Over 1000 properties under management in Berlin. (300 units Group owned)

Real Estate partner of Germany’s largest network of Financial Advisors

Member of the German Real Estate Association

EURIX Group

Propfund Germany is part of the EURIX Group


EURIX Group


Summary… By investing in Propfund Germany 2, you benefit from:


Lower Purchase Prices

Better finance conditions

Higher rental yields

Lower risk

No hassle, Fully Managed investment

Multiple Investment options

2012

Excellent Returns!

Forecasted dividend of 7-10% per year.

170% return in 10 years time

Invest €50K in Germany and Make 170% ROI

Your Exit Amount: €135,000

Joining the Fund

Read a copy of the investment prospectus. Decide the amount you

would like to invest.

Complete the Investment Instruction and return this to your advisor.

The Trustee signs the necessary documents and returns copies of

these to the investor.

Once you have received the documents you need to transfer the funds

to the Propfund bank account.

Receipt of funds is first confirmed by email. Once the 14 days “cooling

off” period has expired, confirmation of funds along with a share

certificate is sent to you by post, this completes the investment process.

Getting Started


Thank You

Propfund Germany 2 GmbH & Co. KG

Friedrichstraße 82,

10117 Berlin-Mitte

T: +49 30 499 05 09 50

E: [email protected]


Propfund 2 presentation v4 web

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Transcript of Propfund 2 presentation v4 web