What we invest in

SIPA manages private real estate investment projects and funds on behalf of clients. These vehicles target attractive risk adjusted returns through the execution of opportunistic investments throughout Europe.

In addition, SIPA works with clients to meet specific investment requirements through tailored joint ventures and co-investment opportunities that are complementary to our investment approach and products.

SIPA can draw on the extensive experience of its real estate professionals and our extensive network to deliver superior management services.

OFF-PLAN INVESTMENT

Buying an “off-plan” property means reserving a property on a new development before the property is completed, often before construction has started. Buying “off-plan” can prove to be a fantastic investment and prices are extremely competitive at this early stage as potential investors only have floor plans and artist impressions of the finished development to view and developers are keen to sell to minimize risk and to provide the project with some forward momentum.
You as investor then have the option of selling straight away upon completion for a profit, or you can hold on to your property for further rental/capital growth whilst having a great holiday destination to visit. Holding on to the property for a longer-term means you can benefit from Bulgaria's accession to the EU in 2007 where considerable appreciation is expected throughout the Bulgarian real estate market, with properties expected to lead the way and appreciate the most in value.
“Off-plan” purchases have provided spectacular returns for hundreds of investors over the last couple of years. The real key to why buying “off-plan” can prove such a good investment lies in the fact that in many cases you only have to pay initially a deposit as low as between 30% - 40% of the purchase price and then nothing until various stages of the project are completed. The rest can be financed with a mortgage if necessary. Mortgages (link to mortgages) are now available in Bulgaria for foreign buyers and this is sure to increase demand and prices still further.
Buying “off-plan” has benefits for both the developer and the purchaser. The developer is able to attract working capital for the project with less potential reliance on bank finance and the purchaser will generally buy at a discount to the expected market value of the property upon completion.
SIPA’s experience is that building contractors typically adjust the square meter price 3 to 5 times, with an average increase of 8% per adjustment from “off-plan” to completion. The largest percentage increase is not surprisingly in the very first stages. As investor have geared access to these increases, is not unusual to realize profits in excess of 50 % of the investment amount.

SIPA SA’s DUE DILIGENCE

A profitable property investor examines many aspects of the future purchase, not limiting the examination to the property alone. This is called “Due Diligence” and is carried out before any decision is made. Due Diligence is an answer to the question: How to tell which investment will be profitable within my risk profile?

Due Diligence is a risk management process and SIPA SA outline it as follow:

• Professional valuations providing realistic parameters for price expectancy.
• Taking into account not only the location but, aspect, surroundings, pollution, views, streetscape, local council plans, community facilities, transport, weather etc.,
• What are the finance requirements for the investment? What kind of investments can be safely geared and how? What investments require no or little deposit?
• There are numerous ways that an investment can be structured from single ownership to joint ventures. The structure of the purchase can make the difference between an opportunity or not.
• The way the sales contract is written can enhance the security of the opportunity or provide for enhancement of the investment.
• Who built the investment and how well built is it? What is the past of the developer, architect and builder? What capital growth has developments by this developer, builder and architect experienced?
• Market reports, demographics, history of sales and rentals in the area, migration and infrastructure information provide valuable information needed to asses the potential profitability of the investment.
• Without addressing each of these topics investors are - exposed to unknown risk - only guessing at the opportunity in a potential investment.