Overseas Property

 MEDICAL CENTRE CHEMNITZ, GERMANY (INVESTMENT FROM €25,000) 

• Chemnitz is a thriving city of 243,000 people, in top 10 German cities in terms of economic growth, with city centre transformed through massive investment post 1995. This 6 storey  property is a modern ( 1992) commercial block with 32 medical/commercial units,  7 roof level apartments , and 54 underground car spaces , 5 minutes from the main  city centre shopping area . Rentable space c 54,500. Two thirds of the commercial tenants are medical–related and there is very low tenant turnover. 
• Initial Yield of 7.45% including all acquisition costs , in a €4.05M deal , financed €2.7M by DKB Bank ,  non-recourse to investors , and €1.35M from investors . Cost per sq ft is c€74 , significantly below any comparable Irish prices even after the large falls in market prices here. 
• The initial excellent yield is based on existing occupancy of 84% where the property has not been managed pro-actively. Our German partners /property managers plan to increase the occupancy level to 90%-95% post acquisition thereby increasing the net yield to an exceptional 8%-8.5%. We have set aside €90,000 for improvements and re-letting campaign.
• Projected returns are 13.7% per annum over a 7 year period pre tax. This is based on conservative assumptions as detailed in the attached Pre-Launch Summary, most notably that the returns assume no improvement in market prices/yield % over the period of the investment, and that these returns are based on occupancy rising to 90%, lower than our target . Tax on exit will be Irish CGT, currently 25%, and qualifying pension funds would be tax exempt. It is important to note that capital repayment on the bank loan alone over 7 year period would equate to 47% of investor equity , which illustrates the strong security for investors .
• Recommended investment €50,000. Minimum investment €25,000, suitable for cash investors and interesting options also available for holders of personal pension plans , and the self –employed .

For further information please contact REA Sothern Carlow (059) 9131218 ; info@sothern.ie

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