AP4 Plans

[C&G]

Check out this website

www.larionovo.com

They have a nice brochure for Alkudia Smir including plot/plan layouts for AP4. They also have new price lists which appear to show the 5% increase.

Hope you find this helpful....

Regards
C&G

[shak]

Have you noticed another set of prices ?? lets not forget the kitchen is fully fitted and that wondeful a/c to keep you cool

[mcneilee]

is my math not right or doe's this not add up


Payment Terms

€ 3,000 non-refundable reservation deposit

20% deposit payable upon private contract, less reservation fee

10% October 2007

A Lettra for 10% of the purchase price will need to be signed at contract stage

70% upon completion c. Oct 2008

20%
10%
10%
70%
=110%

[romablade1889]

As I understand it the "Lettra" is the same as a British "Letter of Intent" so the 10% value of the Lettra is basically a commitment to proceed with the development.

If I'm right, and there's a good chance I'm not as Moroccan or French law is alien to me currently, the final 70% payment includes the 10% value of the Lettra. Hence it would add up to 100%...

Where I've done this before the Letter of Intent is often accompanied by some for of guaranteed payment. In this case it may be similar to the reservation fee arrangement - we give them a cheque for 10% along with the "lettra" and they cash it as compensation if we pull out before completion...

Can anyone with more knowledge of the Moroccan/French system confirm?

[shak]

A letra can be compared to a good old promisory note ( negotiable instrument Act) Its for a credit given for say 90 days or 180 days

The person signs to pay a certain amount due to a specific person on a specific date. ( Its a Spanish way of extending credit) as all credits in Spain has to be notorised etc.

Each letra comes with a tax a sort of stamp duty, yes you guessed it you pay for it and not Fadesa.

When I bought a property from Fadesa this was not done. I paid all my instalements due on time, however as some people did not and Fadesa could not organise their credit control they dediced to introduce the letra.

In order for this to work you have to open a bank account. I feel it will be in a Spanish bank and you will have to have the amount credited to this account before the due date of the letra.

To Welcome you to Spanish banking, please be aware that the money you transmit to the bAnk may take ages to receive to your accout all lodgements to this account is subject to commission.

Yes, you are increasing the liqudity of the Bank but they slap a commission.

[shak]

Hi Macneilee,

Your maths is Ok, nor have you been on stuff scotland is famous for !!!!
Am I right that Fadesa is involved in this development ?????

[romablade1889]

I've been having a look at the website on the train and my conclusions are that they are a wholesaler and not an agent of Fadesa, not in the traditional sense. It looks to me like they've bought pre-release "options" from Fadesa in bulk (remind you of anything Shak? ) and are now selling on their reservations to eager punters in Ireland...

The totals at the bottom of the Pricing page are the giveaway. Why else would you total up the square meterage and prices. It's a cut & paste from their business case spreadhseets...

Mind you, nice profit if you have the balls to do it. By my calculations they'll make at least £3.2m NET profit if they can sell all of them. If they can do this sooner rather than later (i.e. before the next payment to Fadesa is due), their only outlay would have been the deposits (approximately £1.3m - 20% of the £6.5m total worth of their allocations) and they probably got this capital on an interest only bank loan (repayments would be about £7,000 a month give or take a grand!). So in reality their only outlay is in interest payments, legal fees and marketing... Profit will actually be even better than this as I expect they got a suitable discount for buying bulk, at least the 3% commission normally paid to Agents I expect...

I checked with my agent and they claim that the plans in the brochure are pre replanning, so don't read too much into the plans for AP4...

I also called Fadesa about the pricing before I realised it wasn't anything to do with Fadesa... They said that they don't yet know what the price for the next releases will be, except that it will be somewhere between 5-20% higher than our pre-release prices. When pressed he admitted that it would depend on how many people that had pre-reserved actually went ahead and purchased and what the resultant demand for the next release was. Which is fair enough...

Interestingly, if this lot are selling pre-releases at a 5% premium, I wonder what would happen if Fadesa's next releases were at, say a 10% premium. I suspect they'd put thier prices up slightly, but just enough so that they still undercut Fadesa's prices...

One risk is that they can't sell their allocation quickly enough to avoid paying too many interest payments on the loan and flood the market with cut-price apartments, stalling the expected growth, at least temporarily.. If Fadesa had any sense they'd have put minimum price clauses in their bulk order T&Cs - I'd have gone for some kind of tracker where the wholesaler is limited to selling at RRP plus rather than cost plus...

[romablade1889]

In order for this to work you have to open a bank account. I feel it will be in a Spanish bank and you will have to have the amount credited to this account before the due date of the letra.

To Welcome you to Spanish banking, please be aware that the money you transmit to the bAnk may take ages to receive to your accout all lodgements to this account is subject to commission.
.

Thanks for this Shak. I thought that's what a Lettra would be...

With regards the bank account, I was told from the outset by my agent that I would have to open a Moroccan bank account for payments to Fadesa. They help me do this, free of charge... Having opened accounts in Italy before I expect it to be an "interesting" experience. Mind you, the Italian system was easy once you found the right person to offer the "tangente" to

[shak]

I am a bit curios about the letra being used by a Bank in Morocco.

How will a letra be enfoced in Moroccan courts as it has not the same legal weight behind.

I am aware as to who your agents are, They are also selling in Saadia perhaps the system is in place in Saadia. For my knowledge you could find out the finer points of the workings of letras in morocco,

cheers

[shak]

I am pretty sure romablade that this what has happened. Irish all well known for it. They had been doing this in Spain for many years and lately been caught out. A flutter with the luck of Irish can work.

Atleast with that kind of volume they are not exposed to currency risk i.e €.

[romablade1889]

The payment schedule as I was sold it is as follows:

Deposit (paid) £2K

On exchange of contracts 15% of purchase price (less £2K deposit)

During construction 25% payable in bi-monthly instalments

On completion The remaining 60%

Nothing about a Lettra here...

Still haven't received my contract...

[C&G]

I sent the details of this site to my agent..... and this is the reply I got back....

I have just checked with Lucia from fadesa,
Apparently these are Irish agents working off old plans, or plans that
have not yet been confirmed. Fadesa do not know how they got them!!!!!
Or who they got them from

I'm sure maybe they arent the final finished plans..... especially since AP1 is changing... but I'm sure for thoses of us in AP4 they wont be far off. At least it give you a bit of an idea where you will be located.



C&G

[shak]

Why would you expect to be told about

1) letras

2) Legal ramification in the event that a letra is returned unpaid.

3) The cost of processing them.

4) Fadesa s charge of €3000 for flipping the contract

5)Compensation/damages for delayed completion

6)Descrepency is finished item,

7) Undertaking for not building anything which affect your peacefull and quite use etc.

Remember Caviat Emptor, it applies universally.

[C&G]

Just got a further message from our agent....after speaking to Fadesa again....

more info from Lucia, She tells me they have reprimanded that
agent for putting completely wrong information on the web and has told
them to remove it ASAP

Be interesting to see just how different the final plans ....specs etc are...


C&G

[ScottieDog]

My contract says:

15% on preliminary contract
25% in 6 instalments over the build
60% on transfer of deeds

It looks as though the 6 instalments are to be taken from a Moroccan bank account

SD