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Hi Guys,

 

I am new to this site but just wanted to get some feedback on a new investment that i found online, it is very little money in at £12.5k, but Car Park Invest are offering 12% guaranteed on the investment. Apparently Car Park Invest which they call themselves are affiliated with 7 Continent Invest, they seem like a good company, has anybody had any dealings with them?

 

What are your thoughts on the car parks???

 

I have a couple of properties in South of France and also Malaysia and just wanted to know your thoughts on this?

Jordan

Interesting idea this. Have been looking at car parks after spotting advert from The Best Group selling car park spaces with a guaranteed 9% return for next 5 years. Price is £23000 for a 99 year lease. Yield is actually better if you factor in capital appreciation as purchase price is below independant valuation. Seems a very simple commercial property tranaction. Car parks are in Business Bay in Dubai which is main concern but if the return is guaranteed and above market average, risk reward factor seems reasonable. Anyone know of any other car park investments as I like the concept?

7 Continents went the way of all dodgy dealers.

I dont know about carparks, but there seems to be money in renewable energy right now. Companies like Vestas, www.Vestas.com as increasing their wind turbines, EDF, www.edf.com are moving more and more into renewables, ISIS Solar on www.ISIS-Solar.com are offering free solar options and renewable energy is in a number of the papers, so there must be some money to be made there.

The yield sounds attractive but the question you should ask is what is the exit statergy, how do I get my money back if I want/need to sell? Also check on who owns the land. Many car park operators either rent or lease a piece of land so don't have security of tenure.

Yield seems fair for the increased risk as the income is guaranteed (funds in escrow account) for first 5 years which is what caught my eye in the first place. Guaranteed income lasts for 5 years after which I can sell back to operator for the £23000 original price or sell on open market or keep going renting the space out but with no guaranteed income. Car park spaces are under the office buildings which are owned freehold and then leased out to potential investors so . I do know that parking in Business Bay is a nighmare.

Selling on open market intrigues me as looking on internet there seems to be car park space trading in Australia and some US cities, anyone know anymore about this?

Hi Zazuip

 first point so it is very clear - i am part of Best Group and i work on property developments around the world and handle quite a bit of the structured work for property funds.

 I am new on here and was pointed to the forum by a client who is also investing in a car park space - but bottom line is i can answer pretty much any questions you have.

 

basics are as you state. 99 year lease purchased for 23k - it is a commercial property lease on a car park.

the car park is in an office tower - this is not a pay and display type shopping centre car park. each space is contracted to tenants of the offices on monthly / annual contracts

We can demonstrate the financials of the current building so there are no issues and we have the ability to say who is leasing each office - fully occupied the building will house circa 2500 employees per tower and have about 500 car parks.  The first property is a twin tower and there are circa 1000 spaces. the impact is that with a low occupancy the car parks are full. (however we know the office space is more than 90% sold)

The 5 year gtee is supported by a substantial  trustee account (greater than 7.5m)

Current valuation carried out by Allsop and Allsop values each space at 35k - 

all parking reports (Colliers do a good one and we have generated a good one based on external stats etc) suggest that a car park should produce approx 8% of the asset value. 

 

hence the target for an investor is really to hold for the five years using the security of the gtee and then either look at retaining and benefitting from the income or selling and thereby gaining on the capital growth of the asset in the mean time. If you sold at 35k (ie assuming no market growth at all) then you will have received a combination of yield and capital that ought to be north of 17%.

 Your comments regarding secondary markets are correct - there are several countries where car park spaces are being regularaly bought and sold - markets such as Sydney are quite well established  others are much less so. However in most major cities you will find instances of a car park being offered for sale (London generally has a few being sold by estate agents etc). 

If you are interested or have any questions then by all means give me a call - 

cheers

 Jeff  (07958 745628)

Hi Jeff

Many thanks for this and I have since seen the most recent Colliers report on car parks.

 I want to get this clear before progressing, can you confirm:

- Purchase for £23,000 against valuation of £35,000

- You guarantee 9% average return for next 5 years with guarantee from trustee

- I can sell or re-let the space after 5 years

My questions are:

Can I get my money back before 5 years if I need to and can you help me do this?

What are credentials of trustee ie how safe is my money and can you prove it?

What proof of ownership do I get, title deeds?

Thanks for bring so upftront about your involvement

Zaz