arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 24, 2018 19:16:52 GMT
Looks like the supplemental loan is now being filled - at 88.64% LTV! Edit: looks like this was already posted. This has to be quite a concerning loan, however FS seem to be pretty good with insisting CBRE oversee them in making sure at least the first set of properties get finished. Is this type of response normal for FS?
|
|
rs
Member of DD Central
Posts: 467
Likes: 254
|
Post by rs on Aug 24, 2018 19:31:22 GMT
Looks like the supplemental loan is now being filled - at 88.64% LTV! Edit: looks like this was already posted. This has to be quite a concerning loan, however FS seem to be pretty good with insisting CBRE oversee them in making sure at least the first set of properties get finished. Is this type of response normal for FS? This is not normal by FS. I reckon FS understand the outcome if FS do not start to make some changes and especially since recent FCA consultation proposals. Hopefully FS continue on this path to improve significantly.
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 24, 2018 19:35:38 GMT
This has to be quite a concerning loan, however FS seem to be pretty good with insisting CBRE oversee them in making sure at least the first set of properties get finished. Is this type of response normal for FS? This is not normal by FS. I reckon FS understand the outcome if FS do not start to make some changes and especially since recent FCA consultation proposals. Hopefully FS continue on this path to improve significantly. That was my impression. I've been on FS for just over a year, but only been paying significant attention to their conduct for the last few months, but it already seemed to me like there's been a change. Obviously this adds to the costs, but it's much better than the outcomes we've seen from some other loans!
|
|
TheDriver
Member of DD Central
Slightly bonkers
Posts: 493
Likes: 190
|
Post by TheDriver on Aug 25, 2018 12:11:58 GMT
Looks like the supplemental loan is now being filled - at 88.64% LTV! Edit: looks like this was already posted. Except it's not obvious that's the LTV, because the General Info page you first land on says 78%, and you have to go to the Assets tab and scroll to the bottom of the page ( below the pics!) to see the actual figure.
|
|
rogerthat
Member of DD Central
Posts: 2,048
Likes: 1,994
|
Post by rogerthat on Aug 25, 2018 12:19:48 GMT
Looks like the supplemental loan is now being filled - at 88.64% LTV! Edit: looks like this was already posted. Except it's not obvious that's the LTV, because the General Info page you first land on says 78%, and you have to go to the Assets tab and scroll to the bottom of the page ( below the pics!) to see the actual figure. Erm..the LTV is clearly displayed on the Available Investments page...and on the asset tab of the loan itself
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Aug 25, 2018 16:21:51 GMT
hopefully this is a good move but however much do they cost?
I once approached a similar company and it was a very short phone call!
|
|
TheDriver
Member of DD Central
Slightly bonkers
Posts: 493
Likes: 190
|
Post by TheDriver on Aug 25, 2018 16:46:12 GMT
Oh yes, rogerthat , I missed the main page figure, but as I said it's fairly inconspicuous on the Asset tab. Why would anyone buy into this in preference to the higher priority tranches available at a discount on the SM? Although I can see the rationale for lending additional funds to complete a development and salvage/improve the overall return, the FS model of issuing an independant, lower-ranking facility isn't really appropriate as it takes all the risk (very significant at 88% LTV!) at minimal incentive - or indeed no incentive compared to -1% SM!
|
|
james21
Member of DD Central
Posts: 651
Likes: 669
|
Post by james21 on Aug 25, 2018 18:26:29 GMT
The current loan of £114k being filled at the moment is a rank behind, if you are feeling lucky then lend, as many will wearing their beer goggles looking for 15%. Best of British
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 26, 2018 8:40:20 GMT
The current loan of £114k being filled at the moment is a rank behind, if you are feeling lucky then lend, as many will wearing their beer goggles looking for 15%. Best of British Yep, it it pays off then it's a good return. However, comparing the 12% 'profit' (100% development minus 88% loan) vs the interest that is already accrued and the interest on this new loan gives us pause for thought (never mind questions about the actual development!). Anyway, good luck to those involved in this one.
|
|
paulb
Member of DD Central
Posts: 131
Likes: 112
|
Post by paulb on Aug 26, 2018 19:58:37 GMT
My understanding is that some of the next phase of development is being done along work in this phase, so from the developer's viewpoint, over both phases, the overall profit should be more than the 12% which is obvious at the moment.
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 26, 2018 21:53:10 GMT
My understanding is that some of the next phase of development is being done along work in this phase, so from the developer's viewpoint, over both phases, the overall profit should be more than the 12% which is obvious at the moment. That's what they said, and it may be true, but the independent report indicated that the amount of work actually done on the second stage was relatively minimal at best.
|
|
adrian77
Member of DD Central
Posts: 3,895
Likes: 4,122
|
Post by adrian77 on Aug 27, 2018 6:02:06 GMT
exacty - not sure what payment terms CBRE are engaged on - what's it to them if they end up going over the given development budget? I don't think this one was properly budgetted/costed/managed properly from the start and is now past the point of realising a net profit. Hiring a facilities company may well get it finished but it doesn't change the fact it is late and well over budget...
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 27, 2018 8:47:10 GMT
exacty - not sure what payment terms CBRE are engaged on - what's it to them if they end up going over the given development budget? I don't think this one was properly budgetted/costed/managed properly from the start and is now past the point of realising a net profit. Hiring a facilities company may well get it finished but it doesn't change the fact it is late and well over budget... CBRE don't care about the budget to date, they do care about giving an honest appraisal of the current state as that's what their reputation depends on. Additionally, FS have said that these new funds have to be used only on Phase 1 to ensure that at least something is saleable. Again, that's what CBRE can confirm. However, isn't this also where Phase 1 is being 'sold' to the development company to be leased out? That also sounds like a potential risk to us....
|
|
paulb
Member of DD Central
Posts: 131
Likes: 112
|
Post by paulb on Aug 31, 2018 15:33:50 GMT
There's an update on the progress on the build, which appears to be progressing as expected, as verified by CBRE - good to see (both the progress, and the third party verification).
One thing I'm not sure if, the update states "the labourers on site are currently working their notice", but my impression what that there was a phase two of the build still to go?
|
|
arby
Member of DD Central
Posts: 910
Likes: 959
|
Post by arby on Aug 31, 2018 15:45:10 GMT
There's an update on the progress on the build, which appears to be progressing as expected, as verified by CBRE - good to see (both the progress, and the third party verification). One thing I'm not sure if, the update states "the labourers on site are currently working their notice", but my impression what that there was a phase two of the build still to go? The requirement of the latest money was that none of it was to be spent on phase 2. I would assume this means alternative/additional funding for phase 2 isn't secured yet, so work should stop when phase 1 is completed (until at least phase 1 starts realising some money).
|
|