This project provides Crowdestate investors with an opportunity to invest in mortgage secured loan which the Sponsor of the project - EEA Majad OÜ will use as working capital in development project located in Pargi Street 10, Tartu. The funds will be used to refinance current liabilities and to finance sales period of already completed apartments.
Loan amount in this opportunity is EUR 230,000 with 16 months loan period.
Development of Pargi Street 10 property involves two buildings with 50 units in total and two development phases. In the first phase a historical building (originally used as a public sauna) was reconstructed into apartment/commercial building with 42 units, 1670 m2 of total NLA. This phase is completed, use permit for completed units is obtained and ca. 70% of units are sold.
The second phase includes new building to be constructed to the same property - an apartment house with 8 residential units with NLA 785 m2 in total.
The second phase is 50% completed and 1 apartment is already booked. Value of this construction as is is valued to EUR 650,000 or EUR 827 per m2.
The loan is secured with 1st. lien mortgage on 6 apartments (NLA 515 m2 in total) in the second phase of the development project. Accordingly, current value of the collateral is EUR 426,000 excluding VAT. As according to included valuation document, the expected value of apartments after completion will be EUR 1,800 per square meter (excluding VAT), the value of collateral after completion will be EUR 945,000 (excluding VAT).
Gert Roosaar, board member of EEA Majad OÜ has offered his personal assurance in the loan amount to secure the loan further.
Loan period is set to 16 months.
Interest rate for the loan is 11% per annum. The loan will be returned at the end of the loan period or according to sales of collateral units. The Sponsor has committed to quarterly interest payments.
Calculated internal rate of return (IRR) would be 11,44%.
Loan-to-value (LTV) ratio for this opportunity is 54%.
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