The 2nd seminar of "INVESTING IN RESIDENTIAL REAL ESTATE / WORLDWIDE INVESTMENT OPPORTUNITIES" took place on 31 October 2007 in Ararat Park Hyatt Hotel.

06 november 2007

Seminar Organizer - IntermarkSavills Company

A Partner of the seminar was Withers LLP International Law Firm.

There were represented the most attractive investment residential developments both in Russia (Moscow region and Krasnodar Region) and abroad: in Great Britain, Montenegro, Thailand, Bulgaria, with the budget starting from €70 thousand to 6 million.

A new format of project promotion addressed to private and institutional investors caused a great response. The second seminar brought potential buyers of dwelling residence together.

The seminar was opened by Alexander Shatalov, IntermarkSavills Company Partner, who gave a short report on the situation in Moscow and foreign residence markets having paid special attention to the role of dwelling residence property as one of the most important components of balanced investment packet. Withers LLP Specialists told to the guests of the seminar about legal and tax aspects of purchase of dwelling residence in different countries.

Some projects represented at the seminar

1. Ilyinka, a village situated 11 km from Moscow Ring Road, along Ilyinskoe Highway. This is the first project in Russia representing lane-houses (totally, 162 houses of 270-380 sq.m area). Current price is from $3 500 to $4 675 / sq.m. Expected capital cost increase is 25% per annum. The project is interesting for leasing too. Profitability of leasing could attain 8-12% per annum.

Reference: The average price growth in country directions of Moscow Region in 2007 was about 18,9%. The growth of prices for town-houses in 2006-2007 made 71% and outstripped the growth of prices for cottages (58%).

2.Katerina-Alpic in Sochi, in Krasnaya Polyana.

Today, there are a lot of dwelling complexes claimed but most part of them have noteven started and "Katerina-Alpic" is not only already built one but is inhabited partially. Apartments of 38-190 sq.m area could be used for independent dwelling and for leasing including one with the aid of professional management company. There are 160 apartments totally in the mountain surrounded complex and developed proper infrastructure. The expacted profitability from leasing of the apartments will make 9% per annum. Current price makes 3,880 Euro / sq.m.

3.Properties in London at early stages of construction

The residence market in London is steady and is growing for last 30 years. Today, new projects in the regions of mass development are extremely interesting for investments, in this segment the supply doesn't keep pace with the demand. A number of projects at early stages of construcnion were presented at the seminar which has successful location and very attractive prices. Additional advantages - possibility to make deferred payment purchase with initial installment of 10% and possibility to re-sell the contract before the termination of construction. Forecast leasing interest in average is 4-5% per annum.

4.Apart-hotel 1 Westminster Bridge Park Plaza in London.Apartments with hotel service guarantee steady dividends at the amount of 6% per annum to their owners provided that an owner lives in the room 30 days per year and leases in the rest of time. This is an investment project that is not intended for permanent dwelling. The cost of not large apartments in the proposed project starts from ₤200 000.

5.Montenegro.Residence market growth in this extremely beautiful, ecologically protected region of Europe with warm Mediterranean climate makes 25% per annum. Montenegro is planning to enter European Community that implies additional growth of prices for residence. TOday the apartments in San-Ferenze Resort, a modern residence complex, are offered at prices ?178-325 000. San-Ferenze is the first resort in the market of Montenegro with the infrastructure of world class, leisure centre and gym situated next to the yacht-club. There are 160 apartments with 1,2 and 3 bedrooms of 52-140 sq.m area.

6.New residential complexes Sofia (Bulgaria). One of the most interesting projects in Sofia market is Mount View has 128 apartments. Expected profitability from leasing will make 4-6% per annum and capital cost growth durring next 2 years will make 15% per annum. Prices for such apartments vary from ?127 309 to ?225 790.

"Residences of BOtanica"Dwelling Complex is situated 10 minutes driving from the city center. The complex consists of 250 apartments - from studios to penthouses. The project is offered at very attractive prices - from ?1350 per sq.m. It is possible to buy a studio for ?70 000. The expected growth of capital cost: 15% per annum within next 2 years, the expected profitability from leasing makes 4-6%.

Reference: Growth of prices for the residence in Bulgaria for last 4 years made: 2002 - 11%, 2003 - 17%, 2004 - 26%, 2005 - 15%, 2006 - 8%, expected growth in 2007 - 16%.

7.Properties in Thailand, on Samui and Pkhuket islands-resorts.

The growth of capital cost for the residence in this region made 97% for last 5 years (average growth - 15% per year). Today it is possible to purchase an apartment in Infinity Samui Dwelling complex on Samui Island in Thai Gulf with a view to the ocean with Santiburi, a worldwide famous golf club. The first order of the construction complex includes 28 apartments and 6 penthouses. Guaranteed profitability from leasing will make 5% per annum during first 3 years and expected growth of capital cost - 15-20% per annum. The apartment prices vary from $362 636 to $423 075 with 1 bedroom and to $1 175 489 with four bedrooms.

Banyan Tree Phuket Dwelling Complex is a possibility to buy a luxurious villa with a view to the ocean surrounded by tropical landscape for dwelling and leasing with the receipt of guaranteed income of 6% during first 6 years. The expected capital growth of residence on Phuket is 10-15% per annum. Cost of apartments starts from $1500 000.

In the situation of unstable currency and constantly changing prices at stock exchanges, the real estate is still one of the most stable kinds of investment giving the guaranteed income. The real property is one of the safest means of capital preservation in the moment of devaluation of other assets: its cost ii not so changeable as share cost as it brings in an income not only from the accreation to the capital but from the leasing.