Description

WECITY complies with the provisions of Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European providers of participative financing services for companies and Title V of Law 5/2015 on the promotion of business financing as amended by Law 18/2022 of 28 September on the creation and growth of companies. It is authorized by the CNMV as a Participatory Financing Service Provider, registered in the registry under number 9, with a favorable proposal from the Bank of Spain.

Investor, before making your investment, please read the basic information for the investor client, as well as the pre-contractual cooling-off period for inexperienced investors.

Skin in the game: “In compliance with Article 8.2 of Regulation (EU) 2020/1503 of the European Parliament and of the Council of October 7, 2020 on European providers of equity financing, it is hereby informed that in this opportunity partners, managers and employees of wecity may invest. These investments will be made under the same conditions as those of other investors without receiving preferential treatment or privileged access to information.”

The investment

The developer, JBP Inmobiliario SL, is applying to wecity for funding to finance the acquisition and the construction costs for the refurbishment of a building located at 2 Getafe Street, Alcorcón (Madrid), where a 24-room community residence (residential use) will be established.

The asset has a constructed area of 1,116 m² where 24 one-bedroom accommodation units will be developed with areas ranging from 31 m² to 48 m² distributed over 3 floors above ground level. The project also includes 320 m² of common areas distributed between the ground floor and the basement. The developer has already applied to change the use from tertiary (current use) to residential (main and original use of the plot) for the implementation of a community residence. The works will begin as soon as the developer obtains the license for the change of use, which is estimated to be obtained before July 2025.

The project will be financed through a mortgage loan for the amount of €1,350,000 at a fixed rate, which will have a first-degree mortgage guarantee, activating a first phase of the same for the amount of €700,000 which will be destined to the acquisition of the asset. The duration of the loan will be 12 months with a possible extension of 6 months. The developer may activate a second phase of €650,000 to finance the works.

The developer is going to contribute own funds amounting to €600,000, which will be used for the acquisition of the asset.

The loan to wecity investors will be repaid with the sale of the building at a profit, once the accommodation units start to generate income.

Through wecity you can participate in a fixed rate loan operation with an annual interest rate of 11.25% for an estimated term of 12 months (6 months mandatory) with the possibility of extending for an additional 6 months .

The payment of interest plus the return of the invested capital will be made at maturity.

Location and surroundings

The property in Calle Getafe 2, Alcorcón is an excellent real estate opportunity. Located in the historic center, it offers easy access to Metro Parque Lisboa and Alcorcón Central, in addition to several bus lines.

The area has stores such as Eroski and Dia, educational centers such as Colegio Santiago Ramón y Cajal, and the Doctor Trueta Health Center. It is also close to the Parque de la República and the Tres Aguas shopping center, adding residential and commercial attraction.

Collateral and appraisal

The loan will be secured by a^first mortgage on the asset located at Calle Getafe 2, Alcorcón (Madrid).

According to the appraisal report prepared by GESVALT, the current appraisal amounts to €1,411,282.60. The loan to be made to the developer is €700,000, which means a Loan to Value 1st Phase (LTV) on the current appraisal of 49.60%. If the second phase of the loan is activated, the Loan to Value of the project will be 95.65%.

Collateral agent

The constitution, conservation, management, administration and, if applicable, enforcement of the pledge on behalf of wecity’s investors shall be carried out by an entity external to wecity.

In this case, the designated Collateral Agent will be the one indicated in the Fundamental Data Sheet of the investment.

Rating

wecity, as a provider of equity financing services and in compliance with Delegated Regulation (EU) 2024/358 supplementing Regulation (EU) 2020/1503 of the European Parliament and of the Council, provides a description of the project credit rating method used to calculate the ratings. If the calculation is based on accounts that have not been audited, this shall be clearly stated in the description of the method.

Monitoring

The promoter must justify the use of the funds in each of the applications. The use of the funds by the promoter will be monitored by a company external to wecity.

Compliance with Regulation (EU) 2020/1503 🇪🇺

Risk warning

Investing in this crowdfunding project involves risks, including the risk of partial or total loss of the money invested. Your investment is not covered by the deposit guarantee schemes established in accordance with Directive 2014/49/EU of the European Parliament and of the Council (*). Your investment is not covered by the investor compensation schemes established in accordance with Directive 97/9/EC of the European Parliament and of the Council (**). You may not get any return on your investment. This is not a savings product and you are advised not to invest more than 10% of your net wealth in crowdfunding projects. You may not be able to sell the investment instruments whenever you want. Even if you can assign them, you could suffer losses.

Pre-contractual cooling-off period for inexperienced investors

Inexperienced investors have a cooling-off period of four (4) days during which they can, at any time, revoke or withdraw, at any time, from their investment offer or expression of interest in the participatory financing offer without having to justify their decision and without incurring a penalty. The cooling-off period begins at the moment when the potential inexperienced investor makes an investment offer or expresses interest and expires four calendar days from that date. To exercise their right of revocation, Investors may send an email to the following address: reclamaciones@wecity.io, filling in the “subject” field of the email as follows: “REVOCATION – Name of the Opportunity – Full name of the Investor”. In the event that a monetary contribution has been made in connection with the financing offer, this amount will be returned as soon as possible to the wallet that, as an investor/user of the ‘WECITY’ Platform, has been opened in the Payment Institution ‘LEMONWAY’.

Credit risk

Credit risk is defined as the loss that may occur in the event of non-payment by the counterparty in a financial transaction. In this specific case, the risk that the Promoter will not pay the principal and/or interest of the Loan.

Sector risk Risks inherent to the specific sector.

These risks may be caused, for example, by a change in macroeconomic circumstances, a reduction in demand in the sector in which the participatory financing project operates and dependencies on other sectors. In any case, the investor must bear in mind that adverse economic conditions or cyclical changes may lead to a weakening of the Promoter’s ability to meet its financial commitments in relation to the loan.

Risk of default

The risk that the project developer may be subject to insolvency proceedings and other events affecting the project or the project developer that result in the loss of the investment for the investors. These risks may be caused by a variety of factors, including, but not limited to: (serious) change in macroeconomic circumstances, mismanagement, lack of experience, fraud, financing not fitting with the corporate purpose, failure in the product launch or lack of liquidity. In the event of the Promoter’s bankruptcy, the holders of the credits will be considered as credits with special privilege, as they are secured by a mortgage guarantee, in accordance with the cataloguing and order of priority of credits established by Royal Legislative Decree 1/2020, of May 5, which approves the revised text of the Bankruptcy Law (hereinafter, the “Bankruptcy Law”), except for those amounts that, in accordance with Article 272 of the Bankruptcy Law, should be classified either as ordinary credit or as subordinated credit, as appropriate.

Risk of lower or delayed return

The risk that the return will be lower than expected or that the project will default on the payment of principal or interest.

Risk of illiquidity of the investment

The risk that investors will not be able to sell their investment. There is no active trading market for the loan, so it is possible that the investor will not be able to find a third party to whom to assign the loan.

Other risks

Risks that are, among others, beyond the control of the project developer, such as political or regulatory risks.