david42
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Post by david42 on Feb 26, 2017 19:38:01 GMT
Title PC2 Residential Development Liverpool W********* Loan Amount £ 4,830,000 of which £844,145 is available from Property Crowd Security Value £ 9,500,000 LTV Based on Security Value 51% 90 Day Market Valuation £ 8,500,000 LTV Based on 90 day Market Valuation 57% Rate 12% Term 7 months So we need to complete our own due diligence for Property Crowd loans without the help from the famous Cooling Dude. Maybe if I kick things off by creating a thread for discussion of the loan that is currently available, others can add anything they manage to discover. Hopefully charles will be able to re-assure us on my negative observations. As Property Crowd loans do not have reference numbers I have started my own numbering. PC2 because the platform mentions an earlier loan that would have been PC1. My positive observations are: - Nice to see a low LTV based on current value not GDV
- Presumably the apartments can be created with minimum structural reconstruction of the existing building.
- "The borrower and its group have 11 major developments under construction or awaiting planning permission, with a further 10 sites secured for future development."
My negative observations are: - Exit route not stated. The implied exit route is to sell the apartments.
- 7 months looks optimistic to create and sell the apartments.
I could not see anything about default interest payments if the loan over-runs. - Unproven ability of Property Crowd to manage the loan, particularly around late repayment and default handling.
Edit: I have now found a statement on default interest in the Bond Instrument document. If I have understood it correctly the default interest is 12% plus an extra 5 months interest as soon as it becomes late, minus any recovery costs.
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Feb 26, 2017 19:44:36 GMT
Borrowers are connected to DFL012 & PBL120 on SS and 327 on AC Bear in mind there is a min £5,445 investment C_D looking to diversify, so these platforms better watch out  |
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Feb 26, 2017 20:26:57 GMT
Another company in the group has also had a loan from Wellesley which has just refinanced & repaid
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Feb 26, 2017 20:36:29 GMT
charlesAre there any Unilateral Notices we should know about that would increase the LTV (or so SS keep telling us)
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Steerpike
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Post by Steerpike on Feb 26, 2017 21:15:15 GMT
I make it just over 34% invested with 4 days until the end of first fund which begs the question charles what happens if the loan does not fill? |
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Steerpike
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Post by Steerpike on Feb 26, 2017 21:25:04 GMT
Ah - I had read it the other way with 283k left to fund - my mistake £288k now ;-)
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Post by charles on Feb 27, 2017 3:16:06 GMT
I make it just over 34% invested with 4 days until the end of first fund which begs the question charles what happens if the loan does not fill? Hi Steerpike, Our deals are underwritten so it's not like a Kickstarter campaign (if that's what you're thinking), where a project may not proceed if it doesn't reach its funding target).
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Post by charles on Feb 27, 2017 13:37:05 GMT
Hopefully charles will be able to re-assure us on my negative observations. As Property Crowd loans do not have reference numbers I have started my own numbering. PC2 because the platform mentions an earlier loan that would have been PC1. My positive observations are: - Nice to see a low LTV based on current value not GDV
- Presumably the apartments can be created with minimum structural reconstruction of the existing building.
- "The borrower and its group have 11 major developments under construction or awaiting planning permission, with a further 10 sites secured for future development."
My negative observations are: - Exit route not stated. The implied exit route is to sell the apartments.
- 7 months looks optimistic to create and sell the apartments.
- Unproven ability of Property Crowd to manage the loan, particularly around late repayment and default handling.
Hi david42 , Thanks for showing such interest in Property Crowd, as is evident from your detailed analysis. Regarding the points you've raised: there's no "exit route" per se, since this is not an equity investment, but your concern if I understand it correctly is basically "will the developer be able to sell enough apartments to pay me back?" To this point, I can assure you that as part of our due diligence, we have sighted evidence of a large proportion of the underlying development having already been sold off-plan (nod to @leopardcat for pointing out the state of the market in Liverpool), with substantial downpayments/deposits taken in. I.E. we proceeded with this deal with a high degree of confidence that we would get paid back. It's worth mentioning at this point that all of us at PC are significantly invested in the deals ourselves - so we've got skin in the game and absolutely eat our own cooking. 7 months is when we get paid back, not when the apartments have to be completed by - with an eight-figure GDV, the deposits and stage payments should more than cover the repayment of our senior debt tranche. As for Property Crowd, it's true we've not been around for long (applies to much of the whole Crowdfunding industry, to be fair), but the origination partners and principal lenders that we work with *names withheld, please register on PC for details*, have significant experience in the bridge finance space. Regards, Charles
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nick
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Post by nick on Feb 27, 2017 22:50:04 GMT
I make it just over 34% invested with 4 days until the end of first fund which begs the question charles what happens if the loan does not fill? Hi Steerpike , Our deals are underwritten so it's not like a Kickstarter campaign (if that's what you're thinking), where a project may not proceed if it doesn't reach its funding target). Hi charlesWill this loan have multiple closes until the full target raise is reached (with the underwriters selling down in subsequent closes) or a single close? At what time do you need to have your account funded, ie at the time of commitment on the platform or the close date? Thanks Nick
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Post by charles on Feb 28, 2017 1:10:24 GMT
Hi charles Will this loan have multiple closes until the full target raise is reached (with the underwriters selling down in subsequent closes) or a single close? At what time do you need to have your account funded, ie at the time of commitment on the platform or the close date? Thanks Nick Hi nick , in the case of this particular deal, the first close is 1 March (i.e. tomorrow), with the second and final close a couple of weeks later. As I write, £532k of a possible £844k funded. All details are available in the deal room, which is a members-only area, so please register on Property Crowd for full access. With regard to funding your account, we require cleared funds in the independent custodian's Barclays bank account by the close date. When you've submitted and confirmed your investment through the deal room, you will see the account details on screen and receive an automated email with the same. I believe the UK banking system now operates on the 'faster payments' standard, so if you are looking to invest in time for the first close, you should still be able today (28 Feb), but please confirm with the bank beforehand. In any case, please do not feel like you have to rush through the process - take your time to go through the all the information/data we've made available in the deal room (and across the various threads in P2P forum) - we would love for you to be an investor, but not at the expense of proper due diligence. I hate it when salespeople use high-pressure tactics; I'm not Alec Baldwin and we're not Glengarry Glen Ross. We're in this for the long term. Feel free to PM me if you have any questions, and have a great week ahead! Regards, Charles
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pom
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Post by pom on Feb 28, 2017 9:39:44 GMT
Hi charles Will this loan have multiple closes until the full target raise is reached (with the underwriters selling down in subsequent closes) or a single close? At what time do you need to have your account funded, ie at the time of commitment on the platform or the close date? Thanks Nick Hi nick , in the case of this particular deal, the first close is 1 March (i.e. tomorrow), with the second and final close a couple of weeks later. As I write, £532k of a possible £844k funded. All details are available in the deal room, which is a members-only area, so please register on Property Crowd for full access. With regard to funding your account, we require cleared funds in the independent custodian's Barclays bank account by the close date. When you've submitted and confirmed your investment through the deal room, you will see the account details on screen and receive an automated email with the same. I believe the UK banking system now operates on the 'faster payments' standard, so if you are looking to invest in time for the first close, you should still be able today (28 Feb), but please confirm with the bank beforehand. In any case, please do not feel like you have to rush through the process - take your time to go through the all the information/data we've made available in the deal room (and across the various threads in P2P forum) - we would love for you to be an investor, but not at the expense of proper due diligence. I hate it when salespeople use high-pressure tactics; I'm not Alec Baldwin and we're not Glengarry Glen Ross. We're in this for the long term. Feel free to PM me if you have any questions, and have a great week ahead! Regards, Charles Hi Charles, When you say cleared funds by the close date does that effectively mean by close business today, or that so long as it's there when they check in the morning it'll be ok? I have FPS but won't be getting back to the UK until this evening and can't do the payment until then - will I have already missed the boat?
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david42
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Post by david42 on Feb 28, 2017 11:01:36 GMT
I telephoned Property Crowd to clarify the position for early investors and Tasmin confirmed that the loan can close multiple times: if the loan is not fully funded when it closes on 1st March, those who have already invested will get their interest from 1st March; those who invest after 1st March will get their interest from the next close date (8th March as stated in the bond term sheet).
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Post by charles on Feb 28, 2017 13:42:16 GMT
Hi pom , to clarify, in order to make it in time for the first close, you need to have registered, onboarded and confirmed your investment with us through the Property Crowd platform, and of course, your cleared funds need to be in the custodian account by close of business on 1 March 2017 (tomorrow). If you are unsure whether the funds will arrive in time, I would kindly advise you ask your bank - I'm afraid I can't be of any help there, for obvious reasons. It's also worth reiterating what I've said previously, i.e. please don't feel like you have to rush. We advise everyone to "consider your investment carefully, but act quickly". Even if you miss this first close, as I said to nick in a previous post, the second and final close will only be a couple of weeks later (we will confirm the exact date tomorrow). On a related note, I would like to make a small correction to the post from david42 in order to avoid any confusion - those who invest after 1st March will indeed get their interest from the next close date, but that date has not been definitively set as the 8th of March (I respectfully refer you to the bond term sheet again). Instead, as per above, we intend to set the second close a couple of weeks out, but seeing as we only have about £300k left to allocate in this £844k deal, it's entirely possible that we fully fund in a week from now and thus bring the close forward. |
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cooling_dude
Bye Bye's for the PPI
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Post by cooling_dude on Feb 28, 2017 13:46:03 GMT
AdminI think it may be time to give Property Crowd/ charles their own board 
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Post by charles on Feb 28, 2017 15:59:11 GMT
charles Are there any Unilateral Notices we should know about that would increase the LTV (or so SS keep telling us) Hi @cooling_dude, thanks for the question. Sorry it took some time for me to respond but I wanted to give you, and fellow P2P forum members, a proper answer so I had to do a little digging. The lawyers have advised that at the time of drawdown there were no known Unilateral Notices, and filings have been made to maintain this position. To the extent that Universal Notices have since been filed, they would be subordinate to the charge held by the loan facility.Additionally, this specific loan contains a mechanism which requires the borrower to place all deposit money received in a segregated account. A proportion of those deposits are required to be set aside and used for repayment of the loan. Regards, Charles
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