InRento is proud to introduce the first buy to let investment opportunity by a regulated platform in Continental Europe. The investment case is comprised of 2 Rental properties that are located in the central area of the city in the address of A. Goštauto g. 8, Vilnius.
Currently, both of the properties are rented out and are generating a total of 554 EUR per month of rental income. Current absolute yield is 554 EUR per month, which results in 9.44% gross rental yield.
The net monthly rental yield is 443.20 EUR for the distribution to the investors, or in a percentage value equal to 7.55% per annum NET with the given situation of the tenancy.
Reasons to invest in 2-micro offices in Vilnius:
- The investment case consists of 2 properties and both are rented out.
- The investment is generating a 7.55% (9.44% gross) annual yield with the current situation of tenants.
- The assets are located in the central area of Lithuania’s capital- Vilnius.
- The borrower has 15 years experience in real estate.
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Tenants
Office #223 (which consist of 13,76 square meters area) is rented out to a company which is working in the logistics industry. The tenant is paying 260 EUR per month for rent and the outstanding rental contract is valid until 2021 09 30.
#224 (which consist of 17,94 square meters) is rented out to a company working on Cars parts imports. The tenant is paying 294 EUR per month for rent and the outstanding rental contract is valid until 2021 06 17.
Financial terms of the investment:
- Maximum term: 84 months (7 years)
- Rental income share: 80% investors / 20% borrower
- Fixed-interest rate: 1%
- Security: 1st charge Mortgage
InRento investors are granting a loan to the borrower for the acquisition of the rental properties. The loan is secured with a first-charge mortgage which in time of borrower’s inability to fulfil financial obligations would be used to repossess the asset.
The revenue-share between the borrower and the investors is set at 80/20, meaning that the borrower is obliged to distribute 80% of the income to the investors. Current absolute yield is 554 EUR per month, which results in 443.20 EUR distribution to the investors, or in a percentage value equal to 7.55% per annum with the given situation of the tenancy.
- Increased interest rate: 4%
- Capital growth sharing: 70/20/10
What would happen if the tenants would leave the property?
In an unlikely scenario of both of the tenants cancelling their tenancy, the borrower would be paying a 1% annual interest rate until the new tenants would be found. If the borrower would not rent out the assets within 3 months, the fixed-interest rate would be increased to 4% per annum.
What will happen when the property will be sold?
When the property will be sold and it will be sold more expensive that it was acquired. The capital growth will be distributed in the following structure: 70% investors / 20% borrower / 10% InRento.
The project owner:
The borrower - UAB Real Assets, is a newly established legal entity to serve as a special purpose vehicle for a purpose of increased security for the investment. The manager of this company has been working in the Real Estate industry for the last 15 years. He has successfully commercialised residential, commercial and hospitality projects internationally and counts numerous successful sales of companies operating in the real estate industry.
Key investment risks:
Risk of falling prices: the price of the property might fall due to the increase in supply or decrease in demand in the area or other economic factors.
Liquidity risk: The borrower might be unable to find a buyer in order to sell the property.
Tenant risk: Although the assets currently are fully rented out, there is a risk that the asset can lose the Tennant and it can take time in order to find the new tennant.
Investing with InRento, is similar to owning a rental property, however with us you don't have to worry about day-to-day property management and in the periods of vacancy the borrower is required to distribute fixed-interest payments.