Fabrica de Caramida Update Report December 2016

Transcription

1 Fabrica de Caramida Update Report December 2016 Property Update Location Bucharest, Romania Type Land Occupancy Rate Senior Financing Projected Preferred Reserve Valuation Date: 31 October 2016 Appraiser: Winterhill /JLL Value*: EUR 3,045,000 % change from 2015: -1% Equity Gain/(Loss)*: (57%)** Strategy Hold until such time as it will be possible to sell with the greatest realization to investors. Income Generating No *Based on the average of the two valuations. **This represents the percentage gain / (loss) that investors would realise if the asset (property) was sold at its most recent valuation. No preferred return has been paid to date. Market Update In 2016, Romania s property market has been supported by strong economic indicators, where in Q the country reached its highest GDP growth since Q at 6% (year-on-year). It is expected that Romania would register a 5% GDP growth by the end of the year. During 2016, apartment selling prices increased by 6.85% and 5.07% in Brasov and Constanta (respectively). As part of Romania s accession to the EU, certain political and economic reforms were promised in the country, but these have not been implemented. The real estate market was affected by the non-implementation of these reforms, where property prices dropped in excess of 56% between 2008 and As previously mentioned, 2016 witnessed a recovery for the Romanian economy and property prices. Aided by the rise in wages and the labour market, demand for residential units increased during the year. Page 1 of 5

2 Fabrica de Caramida Apartments ( Fabrica de Caramida or the Fund ) Key Developments On 30 June 2016, the responsibility of Investment Manager transferred from Faisal Private Bureau ( FPB ) to Ithmaar Bank B.S.C. (c) ( Ithmaar or the Investment Manager ). Ithmaar is currently looking at different options to maximize the value of the subject plot in Fabrica de Caramida. The average of the latest valuations conducted values Fabrica de Caramida at EUR 3,045,000. Site Visit Ithmaar representatives plan to visit Fabrica de Caramida during 2017, whereby meetings will take place with the local property managers and real estate experts. Page 2 of 5

3 Appendix Central Bank of Bahrain Disclosure Requirements Up-front fees: Up to 0.99% of the total capital. Management fees: Up to 0.52% of the total capital. Original Plan Originally, Fabrica de Caramida was offered as an investment opportunity in the north of Bucharest located approximately three minutes drive from Mackenzie Residence which was the first investment FPB made and exited (within 13 months) in Romania. Fabrica de Caramida is located on an attractive site next to Lake Grivita. The area experienced high growth in residential development due to its proximity to large office developments, hotels and entertainment areas. Fabrica de Caramida is positioned in the exclusive north of Bucharest, away from the city centre. The site provides fast access to the city and is easily accessible from the airport. Fabrica de Caramida encompasses a stretch of land totalling 9,164 sqm (main land plot is 8,705 sqm and an access road represents 459 sqm). The development was planned to comprise of 46 luxury apartments with an average built surface area of 123 sqm per apartment, as well as 92 parking places (all outside). The apartments were envisaged to have a lake view. The Fabrica de Caramida apartment block was to consist of 1 floor (plus attic and basement) and each apartment was to offer an average usable area of 98 sqm. Fund Milestones The Fund land has been acquired by the Fund. Building permissions have been obtained for developing the land. Changes to the Original Plan and Anticipated Completion Date Due to the lacklustre of funds, Fabrica de Caramida was not developed as per the initially envisaged plan, and has since been held in its raw status. As previously communicated by the exinvestment manager, the anticipated completion date for the Fund is 31 December However, Ithmaar is currently assessing various options with regards to Fabrica de Caramida in order to generate the greatest realization for its investors. Planning Permissions Obtained to date Building permissions. Utilisation of Proceeds Fund Fair Value as on 31 December 2016: All amounts in EUR Nominal Equity Fair Value Surplus (Shortfall) 3,371,546 1,173,146 (2,198,400) Page 3 of 5

4 Fund s bank accounts: Bank Name Currency Amount Unicredit EUR 7.45 Unicredit RON 18, Unicredit EUR *The Fund s equity has been fully utilised, and further liquidity is obtained in the form of financing and payables (booked by the Investment Manager) as and when fund expenses arise. Financing undertaken by the Fund: Type of Financing Amount (EUR) % of Financing Drawn down Security Subordinate Financing 134, % Unsecured Amount Spent from 1 July 2016 to 31 December 2016: From 1 July 2016 to 31 December 2016 Category Amount (EUR) Percentage (%) Fund Expenses* 60, % Total 60, % *Fund Expenses represent management fees, office rent, bank fees and other operational fees related to the ongoing business of the company. This includes additional fees paid during Q to maintain the building permit. Recipients of Material Amounts (above 10%): Supplier Amount (EUR) % of Total Spent during the period Municipality of Bucharest* 27, % Mural Group SRL 7, % Mackenzie Capital 16, % *Costs related to obtaining the building permission The company does not have senior management and it is managed by the Investment Manager. Current Board Members of Fabrica de Caramida: Page 4 of 5

5 Name Date Elected Date Resigned Dan Ghita 14/01/2013 Board remuneration paid during 1 July 2016 to 31 December 2016: The Board does not receive any remuneration. Summary of Board resolutions from 1 July 2016 to 31 December 2016: There were no Board resolutions in the period between 1 July 2016 and 31 December Litigation or Disputes: There were no litigations or disputes during the Fund s life. Pledges created over the assets of the investee company: The Investment Manager confirms that the property is free from any pledge or mortgage. Disclaimer: The information provided herein is provided by Ithmaar Bank B.S.C. (c) in the best of its knowledge following the transfer of management responsibility from the ex-investment manager. Every reasonable diligence and caution has been exercised to ensure its accuracy. However, this information is subject to a number of factors beyond the control of Ithmaar Bank B.S.C. (c), including current and future market conditions, constant changes in occupancy and vacancy rates, currency fluctuations, supply and demand, and more. Ithmaar Bank B.S.C. (c) is not a real estate promoter but an investment manager managing the investments on behalf of its clients. Ithmaar Bank B.S.C. (c) has a network of contacts helping it to select appropriate local real estate promoters. Page 5 of 5