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Invest in the idyllic beauty of ancient Greece Prinos Village Crete March 2006

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Page 1: Crete Investor Report 06

Invest in the idyllic beauty of ancient Greece

Prinos Village

Crete

March 2006

Page 2: Crete Investor Report 06

Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

Page 2 of 26

Important

The information contained in this report is confidential and is set out as a general outline of an investment

opportunity. All descriptions, references and other details are given in good faith, as is external market

information that has been gathered by Urban Exposure or is believed to have derived from reputable and

reliable sources. All opinions, judgments, and all financial forecasts and projections contained in this

document are necessarily of a subjective nature and subject to uncertainty. The analysis is based on sources

believed to be correct and reliable and represent the opinion of Urban Exposure as at the date of this

document.

Neither Urban Exposure nor any of the sources quoted or relied upon assume any responsibility for any direct

or indirect damage or loss suffered due to reliance on the information contained herein.

The information contained in this report, including any part thereof, may not be reproduced or quoted to

third parties beyond the intended recipient without the prior written permission of Urban Exposure and/or the

sources quoted or expressly relied upon herein.

Nothing in this document constitutes an offer or solicitation.

© Urban Exposure Ltd, 2006

Page 3: Crete Investor Report 06

Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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Contents

1. Introduction..............................................................................................52. The region................................................................................................53. Prinos Village............................................................................................74. Getting there............................................................................................85. Activities on the island..............................................................................86. The Developer........................................................................................107. The Resort..............................................................................................108. Apartment specifications.......................................................................119. Guarantees.............................................................................................1210. Furniture packages.................................................................................1211. Mortgage Guarantee...............................................................................1212. Rental Market and Projected Open Market Income.................................1213. Use of Apartments by owners.................................................................1214. Capital growth........................................................................................1315. Finance...................................................................................................1416. Inspection visits......................................................................................1417. Payment schedule and purchase procedure...........................................1418. Currency.................................................................................................1519. Tax.........................................................................................................1520. Legal.......................................................................................................15

Appendix 1: CLIMATE STATISTICS..............................................................16Appendix 2: EXAMPLES OF FLOOR PLANS..................................................17Appendix 4: SAMPLE FURNITURE INVENTORY……………………………………………………………20Appendix 5: INTERNAL IMAGES………………………..…………………………………………………..….202Appendix 6: EXTERNAL

ELEVATIONS…………………………………………………………………….…..204

Page 4: Crete Investor Report 06

Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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Summary Information

Urban Exposure is pleased to present you with the opportunity to purchase a luxury

apartment on the beautiful island of Crete. The exclusive development consists of 78

apartments, due to complete in May 2007. Located in a stunning valley with

spectacular sea views and within walking distance of the beach, it is only 10 minutes

drive of Rethymno – a popular tourist harbour town. Urban Exposure has compiled an

excellent package of discounts and incentives for purchasers as follows;

15% Discount incorporated into purchase price

Costs paid for 3 years: including mortgage payments, service charge

& utilities

Full furniture package included

Solicitor’s and notary fees paid

Purchase tax paid

Financing of up to 85% available (subject to status)

Excellent capital growth potential

Fully managed rental pool with free use for apartment owners

Please make reservation enquiries as soon as possible to avoid disappointment. Please

contact Urban Exposure on 020 7763 7186 or email [email protected] with

any queries or to make a reservation.

Page 5: Crete Investor Report 06

Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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1. Introduction

Urban Exposure has secured an outstanding

investment opportunity on the beautiful island of

Crete exclusively for its investors. Not only does

the development have excellent capital growth

potential in the short and long term but the

purchase price has been negotiated to include all

costs associated with the purchase of the

property (such as solicitors and notary fees) in addition to the payment of all ongoing

costs including mortgage payments for the first 3 years.

Excellent levels of financing are available (subject to status and bank lending criteria)

and the price of investing in this Mediterranean paradise is incredibly reasonable

compared with other European destinations.

2. The region

Greece

Greece has long been a popular holiday destination due to its wonderful climate,

beautiful scenery, fascinating heritage and delicious cuisine. The Greek mainland and

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Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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its archipelago of 1400 islands (169 of which are inhabited) boast a 5000 year old

history and are home to just over 10 million people. The islands are divided into six

groups: the Cyclades, the Ionian, the Dodecanese, the islands of the North-Eastern

Aegean, the Sporades, and the Saronic Gulf islands. The two largest islands, Crete and

Evia, do not belong to any group.

Some facts at a glance:

Population: 11 millionArea: 131,957 sq kmReligion: Greek Orthodox 98%, Muslim 1.3%, Other 0.7%Currency: EuroKey Industries: Tourism, Shipping, Food and Tobacco, Textiles, Chemicals, Metal

Products, Mining and Petroleum.Key Trading Partners: Germany, Italy, France, Great Britain, USAPresident: Karolos PapouliasPrime Minister: Costas KaramanlisRuling Party: New Democracy Party.

Crete

Crete is the largest of the Greek islands and

located at the southern most part of Europe.

The island is rich in natural beauty and has

1000 km of dramatic coastline as well as high

mountains and rugged countryside. Life on

Crete is relaxed and informal and the cost of

living is affordable. In addition to this the island

also has a rich cultural heritage which its people

are very proud of, hence the Greek building regulations are every strict to protect the

island from over development. Crete alone accounts for ¼ of the entire Greek tourist

trade and is the only place on earth that you can visit the reputed birthplace of Zeus

the King of the Gods!

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Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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Rethymno

A well known holiday destination on Crete,

Rethymno is a gorgeous harbour town that

manages to cater to tourists and holiday makers

whilst retaining its charm through its fabulous

Venetian architecture. It has a vibrant nightlife

and plenty to keep holiday makers with all

interests occupied. Visitors to Rethymno can

enjoy the hustle and bustle of a pretty Greek

town as well as the idyllic solitude of Crete’s

beautiful coast or mountains within a short walk

or drive.

3.Prinos Village

Located on the North West coast and within a 10-minute

drive of Rethymno, Prinos is an idyllic location for this

exclusive development. The development will be within

walking distance of the beach and has great views of both

the coast and mountains. The location gives a feeling of

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Off plan Investment Opportunity: Prinos Village, CreteConfidentialMarch 2006© Urban Exposure Ltd 2006

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seclusion as well as being ideally located for all the bars, shops and historic sites that

Rethymno city centre has to offer.

4. Getting there

Crete has two international airports: the bigger and principal one is Heraklion and the

other is Chania.  Frequent charter flights link both to many European cities during high

season; flights are currently less frequent during winter. However there are plans to

introduce direct flight during the off peak season which will greatly increase

the rental potential for property on the island. Both airports have regular flights

to/from Athens (about 50 minutes from Heraklion and 40 minutes from Chania) so

connections are easily made.

5. Activities on the island

Historical Attractions - Crete is crammed with

ancient archaeological sites and the island is a

paradise for history enthusiasts but some highlights

are:

Knossos - Other local attractions include

the infamous Palace of Knossos. Home to King Minos this palace dates back to

1900 BC and houses more than 1000 rooms

Nikos Kanzantzakis – The author of Zorba

the Greek is buried just outside Iraklio.

Dikteon Cave – Reputedly the birthplace of

Zeus, king of the gods.

Golf - Crete’s first 18 hole championship golf course was opened in July 2003. Based to

the east of Heraklion the 6430 yard 71 par course. The course also comes with the full

range of practice facilities for novice golfers, tourists and golf club members. This

includes a double- ended covered driving range with practice bunkers, short game area

and practice putting green. There is also a second putting green adjacent to the first

tee. There are plans to construct another course on

the island.

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Water Sports - Most organised beaches in the Rethymno and surrounding areas offer

water skiing, wind surfing, sea parachuting and other water sports. There are also

some excellent dive centres around the island.

Mountaineering/Walking - Crete is home to the

famous Samaria Gorge, Europe’s longest ravine

which has spectacular walks that last between 5

and 7 hours as well as other fabulous nature trails

through mountains and lush vegetation and

historical walks encompassing ancient

archaeological and religious sites. Organised tours

are available or you can just take a map and

explore!

Mountain Biking - Organised Mountain bike tours

are available as well as the opportunity to explore

the Cretan countryside by renting a bike on your

own. The countryside is easily accessible from Prinos by car or foot.

Shops, Restaurants and Nightlife - Rethymno has

an impressive variety of shops selling designer labels,

hand made jewellery, fine antiques and high quality

leather goods. You can enjoy drinks, music and dancing

in the clubs, and folk dances to live music played on

the bouzouki. Whether dining at a local taverna or an

elegant restaurant, there are a delightful variety of

restaurants serving Greek specialities and international

cuisine.

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6. The Developer

A House on Crete is a construction and development company based near Rethymno

on Crete. The company is run by British born Mark Last, who has over 20 years

property development experience and has lived on the island for 9 years. Their

portfolio includes exclusive small developments, restoration work and bespoke luxury

villas. They have an excellent reputation on Crete for the outstanding quality of their

work and the truly personal service they provide to their customers. More information

is available at www.a-house-on-crete.com.

7. The Resort

Carefully designed to work with the

contours and slopes of an existing

hillside, the resort will be built to a high

standard in a traditional low-rise

architectural style. Apartments will be

built in blocks of two, with spectacular

sea views from almost all units. The

resort will be fully managed by an

onsite manager, and facilities will

include;

A communal swimming pool

A shop for food and conveniences

Restaurant with garden terrace and poolside snack bar

All apartments have been designed with well-proportioned spacious living

areas, large windows to allow in the light, and outdoor areas to enjoy the

sunshine and sea views.

There are three types of

apartment available with the

following average sizes:

Studios 35 m2

1 Bedroom 50 m2

2 Bedrooms 60 m2

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8. Apartment specifications

2 Bedroom Apartments

These apartments consist of 2 double bedrooms

of 14 m2 and 13 m2 respectively, one bathroom

fully equipped with bathtub, toilet ball with

flushing device, washstand, mirror, laundry area.

One open plan kitchen and living area of 33 sq

m.

The kitchens is fully equipped with fitted cupboards and sink with tap for hot – cold

water. The kitchen will be fitted with ceramic hob with extractor fan, oven and fridge

freezer.

1 Bedroom apartments

These apartments consist of one double

bedroom with closet of 13.25 sq m and one

bathroom of 4.80 sq m fully equipped with

bathtub, toilet ball with flushing device,

washstand, mirror and laundry area.

One open plan kitchen and living area 30 sq m.

The kitchen is fully equipped with fitted cupboards and sink with tap for hot – cold

water. The kitchen will be fitted with ceramic hob with extractor fan, oven and fridge

freezer.

1 Bedroom studio

These apartments consist of one bedroom with

closet of 12.70 sq m, one bathroom of 4 sq m

fully equipped with bathtub, toilet ball with

flushing device, washstand, mirror and laundry

area.

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One open plan kitchen and living room of 16.30 sq m.

The kitchen is fully equipped with fitted cupboards and sink with tap for hot – cold

water. The kitchen will be fitted with ceramic hob with extractor fan, oven and fridge

freezer.

9. Guarantees

Copies of all guarantees including the Mortgage Guarantee, Construction Insurance and

Construction Guarantees, and Property Management documents are available to view

on request.

10. Furniture packages

Furniture Packages are included in the purchase price of the apartments. A complete

inventory is shown in Appendix 4, and images of internal finishes are in Appendix 5.

11. Mortgage Guarantee

For the first 3 years all costs including mortgage payments, utilities and service

charges will be paid by the developer. All rental income earned from the property will

be kept by the developer, therefore the apartment will be effectively cost and income

free. We believe this is a great way to take advantage of the good capital growth

prospects without having the inconvenience and day-to-day worry of running costs and

rental management. After the initial 3-year period has expired, purchasers will have

the option to keep the apartment in a rental pool, or to manage this themselves. If the

apartment is sold at any point during the first 3 years these benefits are not

transferable to the new purchaser.

12. Rental Market and Projected Open Market Income

The holiday season on Crete lasts for 30 weeks from April to October. Based on 75%

occupancy for a 30-week season we estimate that the development should achieve the

following rents.

Apartment Weekly Rental Income

Studio 300 – 350 euros

1 bed apartment 400 euros

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2 bed apartment 500 – 550 euros

13. Use of Apartments by owners

During the mortgage paid period all owners will be entitled to 50% discount on the use

of the apartment during peak season (June, July and August) OR up to 2 weeks free in

April, May, September or October PLUS up to 3 further weeks free during the winter

months (November – March inclusive).

14. Capital growth

Purchasers of apartments at Prinos Village will immediately benefit from the 15%

discount that Urban Exposure has secured on the development, providing them with

instant equity in their property. We are confident that property prices on the island of

Crete are set to rise steadily over the next few years due to the strong tourist trade

and potential for development on the island. There are plans to introduce direct flights

to the island throughout the winter season which will greatly increase the number of

visitors to the island during the off peak season; as well as plans for new golf courses

to be built which is always a sign of affluence in any area.

Historical data for an 80 sq m property on inland Greece shows an average annual

capital growth of 13.35% over the past 5 years. This is based on off plan property sales

in the Rethymno area.

Year Price in Euros % Increase

2000 75000

2001 85000 13.33%

2002 100,000 17.65%

2003 110,000 10%

2004 120,000 9.09%

2005 140,000 16.67%

Assuming capital growth in the area over the next 2 years of 5% pa, 10% pa and 15%

pa then the equity in the following properties would be:

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Apt

Purchas

e Price

in Euros

Equity

of 15%

on

Purchas

e

Growth Rate

5% paGrowth Rate

10% pa

Growth Rate

15% pa

Value Equity Value Equity Value Equity

A1/

6178,483 26,772

196,77

745,066

215,96

4

64,25

3

236,04

384,332

A4/

487,803 13,170 96,803 22,170

106,24

231,609

116,12

041,487

A9/

1

128,90019,335

142,11

232,547

155,96

946,404

170,47

0 60,905

15. Finance

Arranging a mortgage is a simple process and involves completing a 2 page Bank of

Greece application, attaching the appropriate ID (a colour copy of your passport) and 3

years tax returns.

In conjunction with the National Bank of Greece Urban Exposure has secured loans of

up to 85% of purchase price on properties at Prinos Village*.

Interest rates are from 3.72% during the first year and rise to between 3.92%

and 4.42% depending on the size of the loan. Mortgages are available for 15,

20 and 25 year terms.

*Please note that all rates are quoted directly from Bank of Greece, are subject to change and market

conditions. Urban Exposure makes no representations or warranties about the rates available and or the

mortgage products offered now or in the future by any institution.

16. Inspection visits

Inspection visits to Crete are available to all potential purchasers who will need to pay for the cost of

the flight only. The developer will arrange airport collection and 2 night’s hotel accommodation. The

itinerary will include a project briefing at the developer’s office, site visit, lunch/dinner and a visit to

an English-speaking lawyer if required.

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17. Payment schedule and purchase procedure

1. Reservation

A reservation form needs to be completed and sent to Urban Exposure

A deposit of €1500 is payable directly by bank transfer to the developer

If finance is required, a mortgage application needs to be completed and

sent back to Urban Exposure with supporting documents:

o Proof of identity (colour copy of passport)

o Proof of income (3 years tax returns – P60)

Please note that all reservations are considered provisional until the

reservation deposit is received in cleared funds to the nominated

account

2. Exchange of Contracts

Urban Exposure has allocated a solicitors firm to work on contracts on

your behalf

Exchange of contracts will take place 28 days after reservation

A 15% deposit is payable at this stage

3. Completion

Contracts are completed and legal title transferred

Balance of 85% payable on completion (via mortgage funds if arranging

finance)

Please note that solicitor’s and notary fees are included in the purchase

price of the apartment

18. Currency

All transactions will take place in Euros.

19. Tax

Purchase Tax is between 9% - 13% (on the first €15,000 tax is 9% and on the

remainder tax is 11% - 13%). Please note that purchase tax is included in the purchase

price of units at Prinos Village.

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Capital Gains Tax is currently under review in Greece but expectations are that it will

be between 10 – 30% depending on the value of the property and length of ownership.

Please take independent professional advice with regards to taxation planning.

20. Legal

Please note that all legal cost associated with the purchase of units at Prinos Village

are included in the purchase price. There are no restrictions on the purchase of

property in Greece by European citizens.

The property transaction is executed before the notary and in the presence of lawyers

representing the seller and purchaser. Legal procedures in Greece are fairly simple and

if all the papers are ready and in order a sale can be completed with relative ease by

signing the official contract prepared by the Notary.

Purchase Process for Non EU Citizens

Whilst EU citizens can freely buy properties in Crete; there are certain restrictions for

those people outside of the European Union. However it is possible for non EU citizens

to purchase in Crete. It will in general take about 3 months longer. It is necessary for

your lawyer and notary public to apply to the Minister for the Interior in Greece and the

office there will investigate your position in the community and ensure that you do not

have a history of any kind which might be detrimental to the security of the island, this

is because Crete is considered to be a border territory. Please bear this in mind if you

wish t purchase an apartment.

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Appendix 1: CLIMATE STATISTICS

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Appendix 2: EXAMPLES OF FLOOR PLANS

Sample Studio Apartment

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Sample One Bedroom Apartment

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Sample Two Bedroom Floor plan

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Appendix 3: RUNNING COSTS AND UTILITY PROVISIONS

All cost detailed below are approximations. The purchase price of the unit includes all

service charges and utilities payments for the first 2 years.

Heating: 0 – 800 euros Per Annum depending on usage

Water & sewage: 100 euros per annum

Electricity: 300 – 800 euros per annum

Security: 200 euros per annum

Telephone 350 euros per annum depending on usage

Satellite TV 660 euros per annum for package with UK live sports including

premier league football and films

Internet 500 euros for ADSL line

Building Insurance 610 euros per annum on a mortgage of 100,000€.

Fire and earthquake cover is compulsory.

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Appendix 4: SAMPLE FURNITURE INVENTORY FOR RENTAL HOMES

Kitchen

Chairs/Stools Table Ceramic HobOven Extractor Fan Fridge FreezerLights Cooking Pots DrainerSpatulas Cutlery Cutlery TrayKitchen Knives Bread Knife Chopping BoardSalad Bowl Egg Cups 24cm Dining Plates21cm Deep Plate 18cm B'fast Plate Tea Cups & SaucerWater Glasses Wine Glasses Can OpenerPepper & Salt Plate Rack KettleToaster Curtains Towel HangersAsh Tray Dustbin BucketMop Wringer Broom

Living Room

Lights 3 Seater Sofa bed 2 Seater Sofa bedCoffee Table Chairs TVTV Stand Paintings CurtainsAircon Unit Artificial Plants

Bedroom

Lights Single Bed Double BedMattresses Night Stands Aircon UnitBuilt in Wardrobe Clothes Hangers BlanketsPillows Curtains Mosquito PlugsHair Dryer Iron Ironing Board

Bathroom

Lights Toilet Roll Holder Soap DishCup & Holder Soap Tray Double HookDouble towel Rail Mirror with Light Toilet BrushBin Shower Curtain

Outside

Balcony Light Clothes Horse Clothes PegsUmbrella Chairs TableSun beds

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Appendix 5: Internal Images

Bedroom

Bedroom

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Kitchen and Living Area 1

Living Area 2

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Appendix 6: Computer Generated Images of Houses and Development

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