Project in Madrid: 11% return in 12 months

We are excited to present a new project in Madrid. This time, it is a loan that will be open for investment on Friday, June 21 at 12 PM (UTC+2).

With the Mirador de la Estación project, we return to Colmenar Viejo. This time, to finance the purchase of land for the development of 45 single-family homes. The land is located in the neighborhood near the train station, in the southern expansion area of Colmenar Viejo, close to parks, green areas, and all kinds of services.

The homes will have 4 bedrooms, 3 bathrooms, living room, dining room, kitchen, and storage room distributed over two above-ground floors – ground floor and first floor. They include two private gardens both in the front with a parking space and in the back of the house with access to the community pool and extensive common area.

The Mirador de la Estación project is the third we have financed with Libra Gestión de Proyectos, a developer with extensive experience and more than 6,000 homes developed in cooperative housing.

11% return in 12 months

This is a debt project. In other words, Urbanitae investors will come together to provide a loan to the developer. It is a bridge loan for the developer to purchase the land where the development will take place. The loan amount is 4,190,000 euros, with a term of 12 months and a fixed annual rate of 11%.

Urbanitae investors will exit the project when bank financing comes in. For the bank to enter the operation, Libra Gestión de Proyectos must reach two milestones: achieving 70% reservations and obtaining the building permit. The project already has 40% reservations, which is 18 out of the 45 homes. The Urbanitae loan will finance 75% of the land purchase price and 100% of the structuring costs.

The developer believes they can meet both conditions within 6 months, but we set a duration of 12 months. However, Libra can repay the loan at any time, subject to a minimum return for the investor equivalent to 6 months of interest (5.5%).

First-rank mortgage guarantee

Although we estimate there is sufficient margin, it could be the case that the developer does not meet the deadlines and cannot repay the loan. Therefore, we have established solid guarantees to protect the investors’ money.

Thus, the loan agreement establishes a first-rank mortgage guarantee on the property that makes up the project – the land – through a guarantee agent. The value of the land would more than cover the loan amount and interest. Additionally, the contract establishes a first-rank pledge on the bank accounts of the SPV.

In this video, the developer and our CEO, Diego Bestard, explain the project details.