Project B11GA European Real Estate Project, Powered by Blockchain: The B11G Facility for Industrial Start-ups
About B11GThe B11G Industrial Complex, powered by blockchainWe’re building a state-of-the-art industrial complex for small and medium-sized companies and we want to share the experience with you. We’re raising 1.1m EUR, offering lenders an interest rate of 14% per year, with a maturity date of 24 months after issuance. The name B11G is shorthand for Betooni 11G, the address of the 4,000+ m2 facility we are developing in the heart of Estonia, one of the Eurozone’s fastest growing economies.
With this project, we are materializing the incredible potential of borderless financing made possible by blockchain. As this will mark our 11th such project, our time-tested, prudent and proven business model provides other like-minded blockchain enthusiasts with an excellent investment opportunity through real estate. Together with our partners, which specialize in all areas of blockchain, our expertise in the real estate market brings forward a project of true innovation and value. We couldn’t be more excited to share this experience with the world through the power of blockchain.
Project overviewLocated in one of the fastest growing industrial zones in Northern Europe, the facility will be built in an industrial park, minutes away from the centre of Tallinn, the capital of Estonia. The B11G facility provides a very unique proposition, offering a space for offices, production, warehousing, as well as showrooms, all in the same location. It will be tailored to meet the needs of companies in the industrial sector, enabling innovation in the industrial process of converting raw materials to finished goods and products.
Project B11G will allow people all over the world to share in the profits of an industrial real estate development project. The B11G industrial lot will serve a much needed market, providing multifunctional spaces for small and medium-sized businesses.
MarketWhy Estonia?Over the past years, Estonia has become a hotspot for technological innovation, including a very active start-up culture. With a vibrant tech sector and a growing interest in the country’s
e-Residency program, investors and entrepreneurs are flocking to this European country to pursue business activities and expansion. By encouraging innovation, a country with a population of just 1.3 million has seen uber success, coming in the form of unicorn startups such as Skype, which was sold for $ 8.5B to Microsoft and TransferWise, Taxify (Bolt), and PlayTech, all of which recently achieved $1B+ valuations, among others.
The samewth can also be seen in both the real estate market and blockchain industry. According to ICOBench, Estonia holds a top 5 position for number of blockchain startups launched in a given country, with 268 launches. At #5, Estonia heads the list alongside top economic powers, including the USA, UK, Singapore & Russia. The real-estate market has also shown growth, with flexible rules for lease agreements as well as very low costs for property tax (as low as 0.1% of market value). A recent trend shows the popularity of the industrial property market is growing, particularly with the ongoing development of several industrial parks similar to Betooni Industrial Park.
The Stock Office MarketThe e-commerce market has changed the way we do business. Since the late 90s, companies like Amazon have been looking for more affordable rent, away from brick and mortar sales offices located in residential areas. Instead, businesses opt-in for effective and flexible office solutions which they can combine with a strong e-commerce sales strategy.
The stock office market in Estonia has shown incredible growth over the past years. In a recent interview, 1Partner Commercial Real Estate Manager Kirill Vigul indicates that the rental prices of these versatile workspaces have doubled over the past 3 years due to high demand. According to Ober Haus Real Estate, the largest real estate broker in Estonia, the vacancy rate of similar stock offices was approximately only 5% by the end of 2017, despite rising prices. Rent for these spaces in the same time period varied between €5.5 and €11.0 / m2. During this time, we have seen a move away from traditional remote industrial lots to conveniently-located industrial parks, made up of groups startups, small and medium-sized businesses.
Betooni Industrial Park - Betooni Tööstuspark
The boom of interest in multifunctional buildings began in 2015. Business professionals and entrepreneurs have become aware of the benefits of multifunctional spaces. Betooni Industrial Park is collection of such facilities, which offer a combination of warehousing, office space, a showroom and production space, all in a convenient location. The Park has been energized by a community of businesses and workers from the nearby residential area and is just a 10-minute drive from the airport and the Tallinn city center. It is located in the central part of Lasnamäe district, with great access to public transport and the Muuga sea port, one of the largest ports in Estonia.
Risk AnalysisAs we analyzed the market, we also took potential risks into consideration, ensuring that we pay close attention to and optimize our risk management strategy. While some risks are out of our control, we have taken these into account and formulated strategies for appropriate mitigation. Here is a summary for your reference.
Property market risk - The ability to offer small-sized multi-functional premises mitigates the risk of an inactive property market. Currently, there is limited supply in this segment. In our calculations, we have used a very conservative rental rate per m2; 20% lower than the market rates.
Economic risk - The economic forecast by Bank of Estonia reported a 3.9% annual GDP growth in 2018. The growth is expected to decelerate to 3.5% in 2019, but the general outlook remains healthy. Slower growth might result in pressure on rental rates in the form of increased vacancies, but the effect is likely to be limited. The budget foresees adequate buffers and the project can sustain up to 30% decrease in net operating income.
Tenant risk - All lease agreements are on triple net basis (where the tenant or lessee agrees to pay all real estate taxes, building insurance, and maintenance) and secured with a 3-6 month bank guarantee or cash deposit, depending on the duration of the agreement. Immediate action will be taken in case of 30 days delay and rental agreements will be terminated if necessary. In such a case, the deposit will cover the overdue rental payments as well as vacancy loss.
Development risk - The land plot is approved by the Estonian land authority as production land and we will use up to 80% of the allowed construction limit, thus we do not expect any delays or issues with receiving a construction permit. In addition to that, all utilities (water, sewage, etc) exist near the border of the land plot, which also allows for quick and smooth launch of the development. No geological or environmental restrictions apply to the plot. All estimates regarding the development cost are based on actual valid offers. Respective agreements have been drafted and are due to be signed as soon as financing has been secured.
Real Estate market risk - If the world economy should turn to a decline, institutional real estate buyers may be discouraged and the developer cannot immediately exit the project. With Project B11G, we have taken this into account and we are ready to maintain and operate the project for up to 2 years in order to achieve the minimum required 8% capitalization rates on exit.
We develop:Real EstateThe most valuable asset in real estate is a happy tenant!Throughout our decades of experience, we have achieved quite a lot and developed many profitable projects. Our experience working with the industrial sector particularly has given us invaluable insights as to what works and what doesn’t for a wide-range of processes within the supply chain. Despite our success, we always strive to improve our understanding of the clients’ needs. So we listened and we noticed that our clients have great ideas when it comes to building plans, section sizes, contract length, and lease prices.
Therefore, we decided to take their feedback and launch an industrial start-up project where we can fulfill all their desires; versatility, top-notch design, excellent location, flexible contracts and affordable rent. We look forward to building long-lasting relationships with happy customers. Our client-focused approach has already proven to be successful,
with over 30% of the B11G premises already reserved by tenants.
We have:Real ExperienceWhat have we been up to lately?With over 25 years and 20,000 m2 of real-estate development experience, this will be the 10th project carried out by the professionals at Future Invest OÜ and its partners. All of our projects have resulted in satisfied customers and have achieved a minimum of 30% ROI at exit. Check out some of our past projects and what we’re planning on doing in the future below.
We offer:Real ReturnsA 14% annual interest rate, with a loan period of 24 monthsBy issuing the B11G token, we will carry out the first real estate project financed with digitized loan contracts in Europe. Thanks to the reputation we’ve earned through hard work and hard-hats, 10 of the available 38 leasable units have already been reserved by tenants (as of 25.03.2019). This means that with the B11G token, you turn smart contracts into smart money!
Calculate your return on our website:
https://b11g.eu/Financial OverviewAs a partner, you will receive your first interest payment 6 months after receipt of the loan (October 2019). The 2nd interest payment will be made at the end of the 24-month term, along with the repayment of the principal (April 2021). To protect you against the fluctuations of the crypto market, you will be paid out in EURS stable coin.
The loan will be repaid from proceeds of sale of the property to an institutional real estate investor. Our experience and established network leaves us confident in the eventual sale of the property to one of our professional real estate fund partners. Over the past decade, we have achieved this in an average period of 16 months, in some cases 3 months after the construction has been finished and cash flows from rents secured. In case we are to achieve this earlier, we look forward to repaying the principal and interest payments early.
Project B11G uses ILP TechnologyA new loan agreement structureDesigned by our partners at Blockhive & secured by our partners at Agrello, the Initial Loan Procurement (ILP) model is a revolutionary blockchain-based fundraising mechanism. It allows us to raise funds via debt financing, with blockchain technology acting as immutable proof of all loan transactions. In other words, thanks to tokenization, we are able to procure a loan from a global market of investors. To learn more about ILP, visit
tokenote.io
*While we are aiming to raise 1.1M EUR, our smart contract allows us to accommodate additional investment should there be a high demand. We can issue up to 1.5M tokens at a nominal value of €1 each.
About UsCompanyWe are
Future Invest OÜ, an Estonian investment holding company, which has been involved in the real estate and wood processing business for over 10 years.
Together with our partner Ehitusagentuur OÜ, a leading Estonian real estate engineering and technical supervision company, we have established New Page OÜ, which will become our new flagship investment holding for real estate development projects with stable cash flows generated through the rent of premises. We have compiled a designated team under New Page OÜ, which will work on the projects such as B11G. Our team has decades of experience dealing with various aspects of real estate and we’ve contributed to property developments totalling 19,500 m2+, delivering positive returns in each project.
B11G OÜ is a fully-owned subsidiary of New Page OÜ and has been created in 2018 as the SPV for development of this project.
Members
Advisors
Website | Telegram | OnePager
Show Posts
