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Guest119
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According to the website the Cape Verde fund was due to close at the end of last January. Agree with GDE, this is hardly a 'new' up & coming area.
Cape Verde
- Thread starter Jeremiah
- Start date
The quoted documents on the web were for release 4 of the fund. I found these too using Google. They are now busy with release 7 (which is also Cape Verde)
I'll report back once I've read the details, but my initial suspicion would indeed be that the guarantee is anything but what you'd initially expect, and that we are way too far into the credit crunch for a fund in the overseas property market to be an acceptable risk for me.
Off Topic: FYI for the last month I've been buying bonds traded on Euronext that were issued by major European banks which are now yielding over 8% in Euros (ING, KBC, Aegon, Credit Agricole: yes they could go bust, but these are hardly small names). Deposit account in euros currently yielding 5.2% from a AAA rated bank.... It's a crazy world for those with cash at the moment.
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Guest119
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Agree, Martin. Unless buying for your own use (& I would recommend resale) this is not a time to be 'investing' in off-plan/new build properties overseas. Agents are going under e.g. Parador, likewise developers e.g. Fadesa in Spain. There are far too many new builds in places other than Spain e.g. Turkey, Bulgaria, Morocco, Cape Verde.
Well I've read what "details" were povided. I'm always amazed about how vague these documents are. I guess I should be getting used to it by now.
Here's how I read it.
You are betting on the difference between an off-plan price that a fund can negotiate with an external developer, and the completed price that an external property manager can get on completion from punters. And this for properties in a large development in Cape Verde, which is threatening to become a seriously over-supplied market.
The "Bank Guarantees" are paid for by the developer to cover the case that the developer goes bust. There is no further specification of how big these guarantees are or when they would be triggered or whether they are subordinated compared to the rights of other creditors or debtors etc. etc.
There is no guarantee that the property manager will sell any properties except a "payment" equal to 15% of the deposit which will be paid to the fund after 2 years, if they do not sell the properties.
The 15% "payment" is paid by the property manager into an account in its own name. Since the property manager is going to get a huge slice of any mark up in fees it is pretty meaningless IMHO and pretty much comes out of your own pocket if they have made any significant number of sales. Especially if the property manager goes pear shaped, that "payment" is held in the name of the property manager, not in the name of the fund. I mean I could put 20K in a deposit account in my name and go to a bank and call it a deposit on a house too. But i'm not sure anyone would believe me and would want that cash in their account....
The deposit they quote as 30-50% of the final off-plan price, which they state is a 20-30% discount on the true market price whatever that is (there is no specification in the document of what a fair market price is, or what is to stop the property manager dumping property to his friends etc. etc.)
This is "closed end fund" so you have to wait for all other investors to agree before you can get out. (Unlike buying shares in a publicly traded property fund)
So I shall be putting this one in the bin.
Couple more positives for Cape Verde economy...
Kuaiti co want to build hotel; Cape Verde is attractive for business due to its climate, good governance and democracy.
Cape Verde will receive 51 million euros from the 10th European Development Fund from 2008 to 2013 under an accord formalized Monday in the islands’ capital.
and the oil price is still falling.
Kuaiti co want to build hotel; Cape Verde is attractive for business due to its climate, good governance and democracy.
Cape Verde will receive 51 million euros from the 10th European Development Fund from 2008 to 2013 under an accord formalized Monday in the islands’ capital.
and the oil price is still falling.
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cotton eye
Guest
These are hardly a reason to invest, some company wants to build a hotel wow! and the EU is gives some foreign aid to a third world country double wow. Did you invest in Ethiopia after Live Aid thomsk?
Cotton eye,
Some points which might make you see the aforementioned snippets of info in a different light:-
1) The GDP per Capita of CV is around 37 times that of Ethiopia. Imagine the average wage of Ireland being €1.1 million to get the general idea of the difference in wealth (or poverty as you view it) between the two countries.
2) Foreign Aid was given to Ethiopia in an attempt to ease its starvation problems. Ireland has received EU aid in an attempt to improve its roads
(do you think that African people assume it is to prevent starvation?). Cape Verde is also receiving funding - which is to be used to promote its economy/ capitalism,and bring it out of the poverty trap. Last I was aware, its population (half a million, compared to Etiopia's 75m) does not have a starvation problem!
3) The 'some company' with which you refer (Kharafi Holdings) is owned by a man who I certainly do not think has a poverty/starvation/economic/roads problem, making William Hilton look poor! Indeed, when I read that this company is investing in CV it did actually make me think ' wow! '........not so much the 5 star hotel, but the investing in water and energy interest. Why would they bother?
And finally....no, I did not invest in Ethiopia, either before or after, the Live Aid event.
Some points which might make you see the aforementioned snippets of info in a different light:-
1) The GDP per Capita of CV is around 37 times that of Ethiopia. Imagine the average wage of Ireland being €1.1 million to get the general idea of the difference in wealth (or poverty as you view it) between the two countries.
2) Foreign Aid was given to Ethiopia in an attempt to ease its starvation problems. Ireland has received EU aid in an attempt to improve its roads
(do you think that African people assume it is to prevent starvation?). Cape Verde is also receiving funding - which is to be used to promote its economy/ capitalism,and bring it out of the poverty trap. Last I was aware, its population (half a million, compared to Etiopia's 75m) does not have a starvation problem!3) The 'some company' with which you refer (Kharafi Holdings) is owned by a man who I certainly do not think has a poverty/starvation/economic/roads problem, making William Hilton look poor! Indeed, when I read that this company is investing in CV it did actually make me think ' wow! '........not so much the 5 star hotel, but the investing in water and energy interest. Why would they bother?
And finally....no, I did not invest in Ethiopia, either before or after, the Live Aid event.
Hi Thomsk,
How did you and your friends get on? Did you ever raise the 100k and make the investment?
aj
Nearly there.... The credit crunch has bit somewhat though! But we are in no great hurry. Have been watching the pros and cons of property globally - and some we weren't too surprised about, in the way that they have performed.
Mainly the thinking was that how can the likes of Estonia (which offer what?) sustain unbelievably high gains in value. Put Bulgaria in the same category. Much of Europe hit with credit problems. This is one of the boxes to tick with which Cape Verde looks ok.
Considered Morroco, Cyprus and Dubai, but again decided against. Morroco and Cyprus either too hot or not hot enough for much of the year. Dubai simply too hot. And Dubai showing gains which seem too high - again ready for a fall. USA looks problematic for years. Brazil looks too dodgy, as does Turkey.
Spain - flooded with property and maybe years of flat prices. France we ummed about, but decided not enough sun for ourselves/ others for renting year round.
It's a long-term, steady investment we want, that we can get personal use from - and is not too far away. Considered Canaries/ Calabria but decided against cos the reckoning is that CV offers more value, with more reliable weather - and looks likely to be a popular holiday resort for years to come once it is more complete.
Will be going out to CV soon though (autumn or winter) to scout around further.
One things for sure: we all agree that Ireland's Summer holidays may be a thing of the past (no sun, no great holiday -unless one enjoys rain)
Mainly the thinking was that how can the likes of Estonia (which offer what?) sustain unbelievably high gains in value. Put Bulgaria in the same category. Much of Europe hit with credit problems. This is one of the boxes to tick with which Cape Verde looks ok.
Considered Morroco, Cyprus and Dubai, but again decided against. Morroco and Cyprus either too hot or not hot enough for much of the year. Dubai simply too hot. And Dubai showing gains which seem too high - again ready for a fall. USA looks problematic for years. Brazil looks too dodgy, as does Turkey.
Spain - flooded with property and maybe years of flat prices. France we ummed about, but decided not enough sun for ourselves/ others for renting year round.
It's a long-term, steady investment we want, that we can get personal use from - and is not too far away. Considered Canaries/ Calabria but decided against cos the reckoning is that CV offers more value, with more reliable weather - and looks likely to be a popular holiday resort for years to come once it is more complete.
Will be going out to CV soon though (autumn or winter) to scout around further.
One things for sure: we all agree that Ireland's Summer holidays may be a thing of the past (no sun, no great holiday -unless one enjoys rain)
It's a long-term, steady investment we want, that we can get personal use from - and is not too far away. Considered Canaries/ Calabria but decided against cos the reckoning is that CV offers more value, with more reliable weather - and looks likely to be a popular holiday resort for years to come once it is more complete.
Will be going out to CV soon though (autumn or winter) to scout around further.
One things for sure: we all agree that Ireland's Summer holidays may be a thing of the past (no sun, no great holiday -unless one enjoys rain)
Whilst I can understand the sentiment after this Summer, forgive me for saying so, but I do not quite understand your logic here.
You've rejected Turkey (a country that is already in the process of negotiations to join both the EU and the euro and an established tourist destination) because it is "dodgy" in favour of Cape Verde (a country which is only potentially possibly just maybe going to start negotiations at some unspecificed date in the future to join the EU, has a voluntary peg to the Euro, and might just be the next big destination)? hmmmm.
I would have thought that if your requirements were for:
1) personal use
2) long term
3) steady investment
4) reliable weather
then I would have thought you would be looking for
1) a destination with regular and cheap year-round flights of around 4 hours max from multiple countries so that you and your potential guests can go for long weekends or a single week as well as longer stays.
2) an investment in the euro area to avoid currency risks or change of government policy risks
3) an established and proven favourite destination for European nationals
4) winter sun destination
If you then add on 5) some long term capital gain as a requirement it limits the choice further.
To me that set of requirements would scream "Canaries" as your search location of choice, with perhaps Southern Spain coming in second depending on how long term you are looking and if you really are in no rush to dive in and can wait for the bubble to deflate. In the meantime, if the numbers don't add up, you can buy bonds in a range of safe European banks like ING and enjoy 8% yield.
I just don't see how CV would tick any of your boxes.
But what do I know?
stuartmccorm
Registered User
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- 23
go over and look and beware the infrastructure
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Guest119
Guest
thomsk,
So, ease of access is important. In this week's Sunday Times there is an article about airlines cutting routes this winter, and there is speculation that CV might be down to 1 direct flight a week from Uk - if that !.
So, ease of access is important. In this week's Sunday Times there is an article about airlines cutting routes this winter, and there is speculation that CV might be down to 1 direct flight a week from Uk - if that !.
Thanks for that, BigRog. Found and read the article - this one, I assume...
http://www.timesonline.co.uk/tol/news/uk/article4493293.ece
Have to say I am not surprised at it, given the massive rise over the last year in oil prices.
It would seem that the majority of flights are to Spain, France, Portugal and Italy.
The airlines need to recoup there losses afterall, and they are not discontinuing for good. Given the recent long awaited falls in oil prices, I would anticipate a levelling off in the next few months whereby they find their new equilibrium. Recent research has shown that the hikes in flight prices have not deterred too many people from flying off to the sun. Indeed, lots of people nearly consider it a "necessity" these days - I heard the other day on the radio!
As for flights to Cape Verde, they appear to be slightly on the increase at this early stage...
http://www.capeverdejetaway.com/cape-verde-flights.html
http://www.timesonline.co.uk/tol/news/uk/article4493293.ece
Have to say I am not surprised at it, given the massive rise over the last year in oil prices.
It would seem that the majority of flights are to Spain, France, Portugal and Italy.
The airlines need to recoup there losses afterall, and they are not discontinuing for good. Given the recent long awaited falls in oil prices, I would anticipate a levelling off in the next few months whereby they find their new equilibrium. Recent research has shown that the hikes in flight prices have not deterred too many people from flying off to the sun. Indeed, lots of people nearly consider it a "necessity" these days - I heard the other day on the radio!
As for flights to Cape Verde, they appear to be slightly on the increase at this early stage...
http://www.capeverdejetaway.com/cape-verde-flights.html
emerald lass
Registered User
- Messages
- 17
Thomsk, as an agent and developer in Turkey, I can assure you that none of my business is in any way 'dodgy' and futhermore the vast majority of independent analysis would rank Turkey much higher than CV in a list of viable investment areas.
valid point Martin. Seems to me that Thomsk has his mind made up, he is not interested in debating the pros and cons of an area, he is intent to buy in CV and has his ears closed to any potential criticism of that idea.
Thomsk go and invest 100k in an underdeveloped country with minimal infrastructure and bad transport links, as it is clear that this is what you want to do, and the main drive for you doing this appears to be the weather! IMO 25 degrees is not nearly hot enough in high season, and I would be looking for a hotter climate, with a shorter journey time and beaches I can go swimming at, and know the kids can safely play at. But hey, maybe I'm weird and no one else wants those things, but judging from the numbers of tourists and buyers here in Turkey I doubt I am alone in my requirements! we must be the ones who are wrong, cos thomsk seems to know something none of us know!
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Guest119
Guest
I made the point earlier in this thread that until comparatively recently another third world African country was being touted for its' year round sunshine - The Gambia. Never gets a mention these days. Sure, I know it still gets some visitors but not to the extent that developers are falling over themselves to promote it. My opinion is that Cape Verde will disappear off the tourist map just as quickly.
All these proposed 5 star resorts will require 5 star staff (on 5 star salaries). Doubt many of that calibre would choose CV to ply their trade.
All these proposed 5 star resorts will require 5 star staff (on 5 star salaries). Doubt many of that calibre would choose CV to ply their trade.
I do not doubt your temperature charts.
But temperature has little to do with whether a location is attractive or not.
If I was looking for anything approaching an investment, then I'd be looking at where punters actually go.
In fact for older visitors, who could be your bread and butter in the Winter months, high temperatures and long haul flights to places with poor medical facilities can actually be seriously off-putting.
The Canary Islands are indisputably the current number one medium haul destination for Winter Sun. Everything else is either long haul or doesn't come close in visitor numbers. And short haul just doesn't get the weather.
Disclaimer: I do not sell property or property related products. It's your money....
Was not suggesting your business is dodgy, emeraldlass. Was referring to the fact that we consider Turkey a dodgy/risky country for our personal investment for a variety of reasons, such as it's past and recent terrorist attacks, the fact that it borders Iran, Iraq and Georgia and has its countless doubters for joining the EU.
As for minimal infrastructure/ transport links, it's an emerging market... what do you expect for now in terms of its roads? These are already being sorted - not that CV needs that many roads. The Islands are only the size on average of somewhere like Jersey, so they don't really require much in the way of "transport links", other than taxis- which they have got already. As for getting from island to island, I believe new ferry/internal flight services are now in operation, and new ports, marinas and airports have been/ continue to be built.
You prefer a hotter climate than 25c? How much hotter - this enough?
And you mention Cape Verde's infrastructure. God only knows what the sun does to people's skin when it's that hot!
And safe for kids/ anyone for that matter? How many times are these kind of warnings issued?
[broken link removed]
That's if they're not blown up first by extremists.
I wouldn't say Turkey is a safe country, be it threats from Kurds or Islamic extremists, and I personally wouldn't invest there.
I also hope they don't join the EU.
Please discuss Turkey as an overseas investment location in another thread.
Please discuss how nice CV is (is not) as a tourist destination in the holidays/travel section.
This thread concerns CV as a property investment location.
OT posts may be deleted without warning.
Please discuss how nice CV is (is not) as a tourist destination in the holidays/travel section.
This thread concerns CV as a property investment location.
OT posts may be deleted without warning.