Important Update from Prosperity during Covid-19

As a Loan Note investor with PIP, we are pleased to be able to provide you with an update from one of our key partners and lead Birmingham developers, Prosperity. 

During this time of uncertainty, we hope the below reassures you that we remain confident in the investments we offer. Where there is a small chance the anticipated terms of the notes could be affected by delays in planning and/or construction, the security and value of your investment remains strong and directly unaffected by this current crisis. In the occurrence of any potential delays, your full interest would still continue to accrue throughout the term, up until redemption of the project.  

Here at PIP, we remain sure in our Loan Notes and this is just another reason why so many investors are looking to them for great returns of up to 8.5% per annum, in today's low interest environment.

An update from Joe Billingham & the Prosperity Team

We trust you are keeping safe and well, amidst the uncertain times we find ourselves in. As the ferocity and impact of the Covid-19 virus spreads across the world, we like most other businesses remain committed to protecting the health and safety of all our representatives and as such, will continue to take the lead from government and health care officials as we steer the business through these unchartered waters.

That said, Prosperity Wealth and Developments will continue to operate business as usual with our clients and their investments remaining our top priority.  Through our partnership with PIP, we will of course continue to update you on your developments in the usual way and whilst none of us can predict the future, we are well prepared for what will inevitably be challenging times ahead. 

Naturally, many clients are keen to understand the impact of the current situation on their investments and the market as a whole. Certainly we all appreciate that real estate is a far less volatile investment than other investment classes. Whilst there is no doubt we are witnessing almost unprecedented volatility within the financial markets right now, real estate in contrast, is a ‘real’ asset with a real residual value and thus provides a much more secure position for investors. We have no systemic issues underlying within our sector and as you know, Prosperity is a well-founded business with low gearing, a strong land based asset base and balance sheet, low and adjustable overheads and a full order book.

In relation to our Secured Loan Notes, we are delighted that clients continue to be happy with their returns! With PIP, we recently redeemed our fifth Loan Note, Bradford House, where 62% of clients rolled over their capital into another loan note. It does not stop there though, where we are also on track to redeem Prosperity/Varity House in early April, with clients still so unshaken with their investment and delighted with their returns that 58% of the original £3,060,000 raise is rolling into another loan note.

We strongly believe in property as an asset and the future of the UK Property market.

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As you are aware, the purpose of our Moseley Gardens (3) Secured Loan Note is to raise additional capital to fund the build project up to the end of the project term. PIP are now the senior lender on this project and the security is first charge over the assets. 

In relation to the security, this project is 96% pre sold (legal exchanged contracts on all but 2 apartments based on 30% deposits). A fully bonded fixed price contractor (thus fully insured step over rights should they fail). We are on-site, mid build with the main frame underway.

Latest from the site...

Ground works / foundations are progressing and near completion.
Steel framework has arrived onsite and under construction.
Super structure work commenced.

Photos (taken 23 March 2020)

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foundations work

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steel framework under construction

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overview of the site

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The purpose of this One BHM Secured Loan Note is to provide land finance and working capital during the planning process. 

Latest from the site...

We are pleased to report positive feedback from a meeting in February with the council planners. Prosperity were on track to feature within the scheduled items on Birmingham City Council's planning agenda in April.

As per our recent communication to investors, in a previous correspondence, we advised the committee meeting for final planning consent was to take place at the end of March. The meeting is scheduled for the 26th March. All being well, the usual time scale for planning consent to be granted is 6-8 weeks thereafter, at which point the senior lender will intercede allowing redemptions to take place. 

In light of recent events, there is a possibility that any of the above events could be postponed due to measures against the spread of Covid-19. We will make sure to keep you updated of any changes as and when we are made aware. 

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The Park View Secured Loan Note purpose is to fund site acquisition and provide working capital. PIP are currently capital raising for this note which has an anticipated term of 24 months, and offers returns of either 8% per annum, paid 2% quarterly, or 8.5% per annum, payable upon redemption.

Latest from the site...

Final clearance now in place.
We continue to work with planning and environmental health officers to agree a committee hearing date for planning.

Photos (taken 23 March 2020)

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demolition and site clearance

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site looking towards city centre

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The Smithfield Masterplan encompasses the Smithfield HouseSmithfield Place and Smithfield Square developments. Prosperity have spent the last 3 years raising funds - through our various secured loan notes - and acquiring land within the Smithfield site.

Following further discussions between Prosperity and Lendlease, the proposed strategy is to submit a single planning application for site as a whole - to include residential, retail, commercial and leisure in a single application. This will demarcate heights, massing, and density for each of these usages, alongside transport access points, metro connections, etc.

There is an agreed programme of work to commence in May, with the formal application to follow.

In the meantime, Prosperity’s pre-app remains live as a standalone development proposal, which subject to the timing of the above, may be brought forward and pursued as a separate application as a single phase of the overall project.

Prosperity will provide further update following their meeting in early May.

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Latest from the site...

Prosperity were on track to feature within the scheduled items on Birmingham City Council's planning agenda in April.

Obviously a lot has happened in the last 7 days and we have been advised that everyone at the council is working from home due to the COVID-19 pandemic. How this effects their committee meeting schedule is yet to be clarified. Notwithstanding this fact, we remain on track to feature at the next formal planning committee hearing.