Real estate entrepreneur Endover borrowed 785,000 euros at an interest rate of almost 12% via crowdfunding platform Estateguru to pay off past debts, but according to the company this does not mean financial difficulties, but is their normal practice.
On December 21, the real estate entrepreneur Endover added a loan request of 785,000 euros to the crowdfunding platform Estateguru to pay off previous debts and continue construction work with the money received, writes Ehitusleht.
Endover offered investors an interest rate of 11.5% per annum, for those who were willing to borrow 15,000 euros or more, the builder promised 12% per annum, and for bidders of 50,000 euros or more the 12 .5% per year.
3,404 investors raised the necessary sum in one day and Endover Tööstuse mortgaged 47 properties as collateral for the loan.
ERR asked Endover why a company with a portfolio of tens of millions of euros needs a short-term loan with such a high interest rate or whether Endover has encountered difficulties.
Robert Laud, CEO of Endover, said it has worked with a large number of different lenders over the years, including crowdfunding platforms in addition to banks.
“In addition, we also implemented Baltic bond programs. This ensured that we did not have to depend on the conditions of one or a few lenders, i.e. it kept the risks associated with our financing low,” he said.
Laud added that in this case it was a normal refinancing, where the existing bridge financing, taken for the period from the acquisition of the property until the start of the development, was refinanced with a development loan.
“This is a normal activity. Through crowdfunding we have been financing our projects in a similar way for almost 10 years since the possibility of crowdfunding was created,” added the CEO. “For each project we choose the most optimal financing solution for us, which in this case turned out to be crowdfunding. Due to the increase in Euribor, the difference between the effective interest rate of crowdfunding and the interest rate of a bank loan is no longer so important. Crowdfunding also helps to market the project more widely and increase the visibility of the project.”
Laud noted that Endover finished 2023 with the second-best new sales volume ever and approximately 90% of completed apartments and commercial spaces in their portfolio of developments have found an owner.
According to Laua, development and construction activities will continue as planned in the Volta neighborhood in northern Tallinn, in the Rocca Towers skyscraper district in Haabersti and in Viimsi in Haabneeme.
2024-01-04 09:44:00
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