Bulkestate announced today that it is preparing to launch a new investment project in Latvia, Riga.
Bulkestate OÜ has signed a purchase agreement for a property (land 2,077 square metres and building) located on Nometnu 18, Riga. The property is a part of Riga’s famous Art Noveau collection, a 4-storey apartment building in the Āgenskalns district. The surrounding area is a mix of residential houses and light commercial facilities. It is a convenient location, only 10 minutes away from the city centre and 15 minutes from the Riga airport. The building was owned and managed by the University of Latvia as a residential property.
The property includes 12 apartments and two commercial premises as well as an adjacent wooden building. All apartments and the wooden building have been reserved by buyers with contracted sales revenue 866,000 euros and 86.6 thousand euros paid to Bulkestate as a reservation deposit.
Location, quality of the building and significant discounts to the market price have facilitated fast sales process and high commitment from the buyers to complete the purchase.
Commercial premises will be sold after completion of apartment sales process. The expected sales price for these is 250 thousand euros.
The loan amount will comprise EUR 800,000 and will carry a 17% annual interest rate.
The loan will be used to finance payment of purchase price and transaction costs and will be repaid by payments for sold apartments.
The loan is secured by a first rank mortgage on the building. The market price of the building has been defined as EUR 1,400,000 (LTV ratio is 57%).
For technical reasons, loan agreement will be signed by LP Private Property SIA (a company controlled by Bulkestate OÜ) who will lend these funds to Bulkestate OÜ to pay the sellers of the building and associated transaction costs.
All funds received by Bulkestate from investors will remain at Bulkestate and will be directly used to complete the acquisition of the property.
Loan and accrued interest will be paid within 3 months.
For this project Bulkestate offers the following special incentive pay (cash-back) for investors:
- Investors making EUR 10,000 or larger investment will receive 1% incentive payment from the invested amount (representing 4% annual interest rate), while
- Investors making EUR 25,000 or larger investment will receive 2% incentive payment from the invested amount (representing 8% annual interest rate).