Description
wecity is in compliance with Law 5/2015 and Regulation (EU) 2020/1503 of the European Parliament and the Council of 7 October 2020 concerning European providers of participatory financing services for businesses. It is authorized by the CNMV (National Securities Market Commission) as a Participatory Financing Platform registered under number 30, with a favorable recommendation from the Bank of Spain.
Sotabento, through BLM Invest & Development SL, is seeking financing from weCity for this investment opportunity, which involves a first-ranking mortgage-backed loan aimed at funding the construction of 2 semi-detached single-family homes located at Calle Victoria del Angels, 6, Roda de Bará (Tarragona).
Investor, before proceeding with your investment, please read the essential information for the investing client. Past returns do not guarantee future returns.
Project Summary
We introduce you with an opportunity for a Fixed Rate Loan with a First-Rank Mortgage Guarantee.
The plot of land has an approximate total area of 810 m2 and has been granted a building permit for the construction of 2 semi-detached single-family homes.
The developer contributes the unencumbered land (€124,867 of own funds).
The developer is requesting a fixed rate loan of €450,000 from wecity for the execution of the construction. This loan has a First-Rank Mortgage Guarantee.
Through wecity, you can participate in a fixed rate loan with an annual interest rate of 10% over an estimated period of 12 months (6 months mandatory compliance). The total estimated profit is 10%. Interest payments plus the return of the invested capital will be made at maturity (month 12).
With a minimum investment of €500 and no investment limit, you can participate in this opportunity with excellent profitability and maximum guarantees.
Valuation and Rating
The current appraisal for mortgage guarantee purposes (Order ECO 805/2003) amounts to €228,875.96 (land).
The appraisal based on the assumption of a completed building amounts to €660,674.88 (2 houses). This represents a Loan to Value (LTV) ratio based on the HET appraisal of 68.11%.
The Loan to Value (LTV) ratio for the first disbursement is 65.81%.
An external rating for the project has been requested from the consulting firm JLL which has assigned a rating of AA to the project.
Project
The project involves the construction of 2 semi-detached single-family homes with a private garden and swimming pool.
Areas and Location
The project is located in the municipality of Roda de Bará, Tarragona. It is only an 8-minute drive from the coast and 20 minutes from the city of Tarragona.
Roda de Bará is one of the best-preserved towns in the area and, apart from its historical essence as a passage along the Via Augusta, it has become a prominent tourist and residential hub on the Costa Dorada. It boasts beautiful golden sandy beaches such as Playa Larga and Playa Pelliseta, as well as modern nautical facilities.
Collateral
The loan will have a first-range mortgage guarantee on the land and the construction located at Calle del Angels, 6, Rodá de Bará (Tarragona).
The independent appraisal entity responsible for determining the value is KRATA, whose corporate name is KRATA SA SOCIEDAD DE TASACIÓN, and it is registered as an Approved Appraisal Company by the Bank of Spain with the number 4,323.
According to the appraisal report carried out by KRATA, the current appraisal value of the land amounts to €228,875.96.
The loan to be granted to the development company is €450,000, which represents a Loan to Value ratio on the initial disbursement of 65.81%.
Security Agent
The establishment, maintenance, management, administration, and, if necessary, execution of real estate mortgage rights on behalf of the investors will be handled by an external entity to Wecity.
In this case, the designated Guarantors Agent is Bondholders.
Bondholders is a professional company specialized primarily in providing trustee services and independent agent services for various asset classes and under numerous international jurisdictions.
In recent years, Bondholders has been appointed as an agent and trustee in over 400 transactions representing a total of nearly €200 billion in debt.
Among its key clients are financial institutions, institutional clients, asset managers, and sovereign government agencies, among others.
At present, it is one of the leading providers of independent fiduciary services in Europe.
Monitoring
The developer must provide justification for the use of funds in each of the requested disbursements.
The utilization of funds by the developer will be monitored by an external company to Wecity.
Bulletpoints:
· Investment Type: Fixed Interest Loan.
· Interest Payment: At maturity (month 12).
· Guarantee: First-range Mortgage.
· Additional Guarantee: Benso Construcciones y Obras SL acts as a guarantor of the loan in the capacity of joint surety.
· Purpose of the loan:
Construction expenses and development of real estate projects. The property details are as follows: Property No. 11,796 in Roda de Bará, Vendrell-2 Property Registry, CRU 43028000128628. The cadastral reference of the plot is: 2500310CF7620B0001HJ.
· Contribution from Promoter and Wecity Investors:
· BLM Invest & Development SL: Owned land without encumbrances (€124,867 of own funds).
· Wecity Investors: €450,000.
· Property Type: New Construction – Residential.
· Interest Rate: 10% per annum.
· Estimated Total Return: 10%.
· Loan-to-Value (LTV) based on Appraisal: 68.11%.
· Loan-to-Value (LTV) based on initial disbursement: 65.81%.
· Loan Term: 12 months.
· Minimum Investment: €500.
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.
