An Overview of Profitable Investment in UK Land:
Who:
PROFITABLE GROUP is a Strategic Land Investment company, which has offices in Singapore, Malaysia, Brunei, Bangkok, Philippians, Hong Kong and Toronto, Canada. Four of the directors are originally from England and have been in the land business for the last 20 years. They own land all over the world. They moved to Singapore because of the capital gain benefits in that country. In Singapore capital gain is "0", so it's a great place to have a business. Our North American operation is in Toronto, Canada. The company and directors have a lot of liquidity due to their success with land. Andy Nordman, Tim Goldring, Nigel Blanchard and Neil Osborne are the 4 directors.
What:
The company purchases a site of raw land and then gets it through planning permission (zoning). The uplift is usually over 400% when the land is zoned and sold to a developer. Profitable Group's only intent is to buy the land and get it through zoning. Profitable Group have 4 sold out sites. About 5 years ago the government passed legislation in the UK to make it legal to purchase raw land and subdivide it into Freehold Title Deeded Plots. This is when the company was formed. We purchase parcels of raw land, subdivide it into plots, and sell 80% to investors, keeping 20% for the company as the largest investor.
When the site goes through planning permission (zoning) it gets sold to a developer. At this point we are out of the process. The developers build the homes on the site. All plots are sold as a collective parcel of land. All plots are equal. Our strategic trust company takes the monies from the sale of the site to the developer and keeps it in trust until all investors have been contacted as to where they want their funds to be sent. The pay out is equal to each plot. If you have 1 plot or 5 plots - you get same amount of money times (x) the plots you have.
Fourth Project: Concord Village, Hounslow, England (2 miles south of Heathrow).
Where:
Concord village is located in the greater metropolitan part of London in Hounslow Felton, the area of Middlesex. The site, is situated 2 miles south of Heathrow airport in an existing residential area. We are not land bankers.
We strategically buy in locations that are positioned to be developed next. The Concorde site is 120 acres in a location with sustainable roads, pubs, churches, trains and subway. This is a very desirable location to build. 50 acres will be slated for housing and 70 acres will remain parkland.
Why the rising value of land and what contributes to the fundamentals.
In 24 years, the price or raw land has consistently increased in the UK by 1828% and continues to rise. At present, the UK needs to build 5.4 million homes in 15 years. In the area where the site is located, they need to build 46,000 homes now. This site is only slated to build 1000 homes. The housing shortage is compounded by the increased population of immigrants from neighbouring countries such as Poland, Romania, Estonia, and other eastern bloc countries following the introduction of the EU in 2004. This combined with the fact that Brits have large families and high divorce rates also adds to the supply and demand problem for housing. PG provides the land to build the houses. So, until they address the serious housing problem, theses figures will not come down. Even if the housing market takes a correction, land value continues to go up approx. 25% every year and doubles in 3 1/2 years. These fundamentals exist for great investment potential because investors can purchase at accessible prices to own land in the UK.
How Much? - How Long? - How Big?
Depending on the exchange rate of the day. We take the cost of the plot(s) and multiply it from pound sterling to CAN dollars. I'll give you an example if the rate was $2.00 CAN 1 plot -8,000 pound sterling x 2 =$16,000 CAN.
Some of us purchased it when the pound was much higher a year ago.
Initially we were looking at 7-10 year hold when we started selling this site 2.5 years ago and then a 5-7 year hold, and now we are looking at a 2-4 year hold and possibly sooner. It's been moved again twice in the queue due to the preempted agreement from Taylor Wimpy - the Developer who wants to buy the site. A preempted agreement means that Taylor Wimpy has put a large deposit on the land to ensure that they will be first in line to purchase when the site goes through zoning.
I also mentioned that the UK government has been talking with us as well because of the requirement for an additional runway at Heathrow Airport and thus a site to replace the 600-700 houses they are going to have to tear down.
How Big?
A plot is 580 square feet - the size of a good size garage. The intent is not to build on it. The second reason, we keep it small to avoid the Stamp Duty Tax that the plot price falls below.
Remember, the size of the plot is just for investment purposes, we are not going to build on it, live on it or retire on it.
The process:
You would fill out a signed application with us with a 20% deposit or full amount. The balance of the amount is a bank draft or money order. Or in some cases, the customer will wire the money into our Trust account.
After the final payment or all monies are complete, our Broker of Record will contact you and courier the TP1 form and the AP1 form for you to sign and mail back to our offices.
The TP1 is the transfer documents from her Majesty’s Register to you, the plot owner and the AP1 is an application for amendment from Profitable Group, the company to you, the plot owner. Within the TP1 is the legal documentation of the option agreement and the map indicating where your plot is and the number of the plot.
A copy is kept at the office, one is sent the registry office in the UK and you get a copy.
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Concord Village, London (Heathrow UK Area):
If you were to purchase a plot at 8,000 pounds sterling which is approximately $16,000 CAN and the site was to go through planning today, it would be worth approximately $41,000 CAN.
In 2 - 4 years (estimated hold time) it would be worth approximately $50,000 - $60,000+ CAN.
These are all based on VOA stats (Valuation Office Agency stats / UK government / www.voa.gov.uk)
Profitable Group already has a buyer for the site, which is Taylor Wimpy, (Monarch Construction in Canada) the biggest developer in the UK and a major global developer..
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Due Diligence: Key facts to consider:
UK Land has increased in value by a mean average of 1828% since 1983 (/source: Valuation Office Agency www.voa.gov.uk
United Kingdom must build 5. 4 million new homes by 2026 to meet minimum demand (source: Office of the Deputy Prime Minister, 2006)
Profitable Group transactions comply with all Ontario Real Estate regulations; Funds are held in trust and administered by our Broker of Record.
DLP Consultants (www.dlpconsultants.co.uk
Plot ownership Title Deeds are issued by Her Majesty's Land Registry Office (www.landreg.gov.uk
Wayne Sproul MPA
Business Development Executive
Profitable Group (Canada) Ltd.
80 Bloor Street West, Suite 400
Toronto, Ontario, M5S 2V1
T: 416-921-2830 ext. 220
D: 416-355-2174
Toll Free: 1-888-671-9934
C: 416-220-0024
waynesproul@profitablegroup.com