Investment in real estates for private investors
Content:
Background
If there is a stereotype in the market about how much you can earn in the private villa construction industry, it does not at all mean that this is actually the case. What the majority cannot do, the few enthusiasts who are able to break these stereotypes are able to do. As the great Einstein said, "There is always an ignoramus who does not know that it is impossible. He is the one who makes the discovery." The issue is that everything starts with an idea and a dream. The more we immerse ourselves in thinking about our dreams and are willing to spend our personal time researching the issue, the more the door to success is opened.
When I came to such a distant and incredibly difficult country as China, it seemed to me that finding my own niche there was simply impossible, especially given the inscrutable local mentality, which is simply impossible for the European to understand. However, it turned out to be possible. I just had to spend 25 years of my life on it. And then, as if by magic, suddenly this niche appears, where there is not just no competition, but where no one has even heard of it at all.
The whole world is a world ruled by stereotypes. Only a few people can see the horizon a little further. But then a wonderful world opens up, hidden from everyone and access only to those rare individuals who discover this secret. Having found your niche 25 years ago, you realize that if this business works in one country, it will work everywhere. It's just that this niche is small enough for an entire industry, but incredibly large for a private business that seeks to remain outside of industry standards.
Profits of 100% are not something incredible for investors
All my acquaintances have always discouraged me from such a question, saying that the market is simply not able to believe such advertising fairy tales.
It will not seriously consider such investments. And who needs others? There are plenty of such offers with 15-20% profitability on the market. Few people believed in the so-called fairy tales that it is possible to overcome the Earth's gravity and escape into space, considering them a figment of imagination of individual dreamers.
Where are we today? Why does no one even remember about it anymore? Because now it has become a reality. If someone thinks that such profits are impossible, they are simply behind the times and are unable to see this unique niche where a breakthrough could and should be made. But someone knows how!
Working in China for so many years, my profession was to create private villa niche projects for investors whose aim was to resell ready-made properties on the market. If we examine why this type of business was in demand, we come to the conclusion that investors invest only in uniqueness, in those projects which, due to their uniqueness, could bring not just good profits, but super-profits. And for this to happen, the property should really become special, having no analogue in the market. Investment in real estates for private investors:
This is what became my profession. An unusual view of the world, design, ideas and ways of realising projects are able to open doors to a small community of private investors who are looking for just such projects. They are not interested in market standards, they are interested in an unattainable rate of return that only people with talent can achieve.
What is needed to achieve a return on investment of 100%
The formula for success is incredibly simple, but it's also incredibly complex. Here it is.
1.Project name (attracting a global brand)
2. A unique concept of the property itself and creating a story around the project
3. A new look at the architecture, interior design and landscaping
4. Low cost of implementation while maintaining the highest standards.
It seems simple and many private developers will argue that these are the kind of projects they have been doing all their lives. Yes? Then why does their rate of return remain at 15-20%? What is wrong? The answer is simple - everything is wrong! No matter how you describe all the charms of your project, the question of selling price remains open. Will the market want to pay them more than the established standards?
Most properties on the market follow the same stereotypes: build what the market needs. Within the framework of these stereotypes, everything becomes average: typical architecture, typical interiors, at best having a couple of pieces of furniture from Armani or Fendi, landscaping that cannot withstand any criticism. So What, such investors would say? At least, all of these things are sold perfectly well. Why innovate?
Well, first of all, it doesn't sell so easily. The competition starts to kick in. And most importantly, we are never going to exceed a profit margin of 15-20%.
Could there be houses in Marbella worth 200 or 300 million Euros?
One day, in a conversation with Night Frank, testing the reaction of real estate agents (we were selecting a villa for my partner), I told the story of the creation of one of the properties, the cost of enormous value could reach 300-350 million Euros and my dream to build such properties on the coast. Not expecting such a reaction to my story telling, I suddenly heard not surprise at my story, but full approval. Such projects are exactly what the market needs today. For clients with high demand, there is simply nothing to sell.
The monotony of property slows down sales tremendously.
And now the most important thing. In order for a sale price to be so high, what kind of property does it have to be? Could anyone in the market today spend so much time and money to create a concept like this that you could forgive such a rate of return for? If anyone could, we would have seen examples.
Yes, of course, there have been properties with an asking price of 30 million Euros and then selling for 40% less. But is it all that unique? What is the uniqueness? The number of square metres? Houses of 4,500 square metres are not intended for private residence and are most likely suitable for corporate parties.
How long was it going to go on sale? A lot!
Well, what if we are talking about a value of 300-350 million? What kind of property is that and why would a consumer be able to shell out that kind of money for it. In America, properties of this class are not very rare, the market offers similar properties, but on the coast of Marbella? If such projects appeared, it would be a world sensation.
The question is, does anyone have an example of such a property here on the coast? Yes, we do! This is one of the redesigned projects I once did for an Asian billionaire on his private island. That's the story!
Market Value: 350,000,000€
This is our most ambitious idea. The property is on an artificial lake with its own island, a mansion in a luxurious private park with turnkey service, from the unparalleled security system to the selection of staff with a butler in charge.
A 3,500 square meter villa with home theatre, full size SPA complex, two guest houses of 550 and 400 square meters, a 300 square meter security building, its own underground bank vault in a secured bunker, a unique private park of 20 hectares, heliport and marina, elevated bridge to the island and even a private chapel. The lakefront property has an area of 200,000 square meters, the project with no match in the world, with the most luxurious interiors and unique landscaping.
We are making an architectural model for this project with all details for landscaping, lighting and fountains around to be delivered to our showroom as a display item showing our new and revolutionary concept of Collectable Type of Property.
The architecture and overall concept is designed in such a way that the property could be easily transformed to suit the required size. Everything here is unique: from the architectural planning to the customised turnkey interiors and the unique landscaped park with marble mosaics and fountains.
The project is available for interested investors. It represents the unique intellectual property of the owner of this project and may not be fully open to the general public.
This is one example. Yes, of course, it is an ambitious project, but it is conceived precisely so that we can show private investors what level of property we are talking about. The capabilities of our unique workshops, which are able to realize an architectural model of this class, will allow us to recreate one of our projects with the highest realism.
Designers are limited by the capacity of factories
Why today we are witnessing such a catastrophic decline of design in its general concept. The reason here is that designers are limited by the opportunities that factories provide them. With the general crisis in everything from the cost of electricity, rising inflation, uncertainty in the labour market and many more factors leading to the curtailment of production towards total minimalism, we see this decline. Such decline leads indirectly to a change in aesthetic perception. Gradually, there is a degradation of the consumer. Even luxury products are becoming more and more similar to the luxury mass market. And what's next?
In my opinion, the next thing is to start the process of revival sooner or later and a complete reset in the world. The world will sooner or later revert to the strongest stratification of consumers, and the possession of luxury goods becomes the prerogative of the chosen few.
Look at what famous brands have been transformed into today. All for the needs of the day and all in pursuit of profits. What kind of exclusivity are we talking about? Mass market in everything and everywhere.
And then, the question arises: how can you build uniqueness when everything and anything is averaged out? Where do you get ideas and, most importantly, how do you make them happen?
Why the idea of Collectable Property was born
I had this idea many years ago, and the trigger was my work for the most famous construction companies in China, in the luxury segment. With the monstrous competition in the market, in order to attract interest and develop a new niche, it was necessary to design something that would be out of the ordinary and could appear in the luxury housing market as a novelty. And that's when the concept of Collectable Property was born, which was later elevated to the rank of a new trend. You can think of anything, but until the possibility of implementing all these unusual design ideas, everything remains on paper.
And it is at this point that such productions appear, which can lift the ban on any, even the most daring design ideas. But this is a special topic of conversation, although no less fascinating for a detailed story. But we will talk about that another time.
So, we get a unique opportunity not to think any more about the capacity of factories and, most importantly, not to think about the cost of production! However paradoxical this may sound. In my 25 years of experience, the cost of producing even the most ambitious design ideas is perfectly understandable and predictable.
This is what leads to a new direction, where ideas can be realised whose cost in Europe may not be commensurate with the value of the property itself.
Knowing this know-how, as well as many other opportunities hidden from most people, has made a breakthrough in the creation of Collectable Property.
In all my articles, I summarize this concept, so that the investor can quickly understand what we put in this concept of Collectable Property and why it is possible at all such rates of return, beyond the standards of the industry. Yes, because it is simply impossible to get a property of this class in Europe, taking into account the cost of all its decoration, without a sharp increase in production costs. And this means that we do not gain at all on this and with the increase in the cost part, we still leave 15-20% of profit.
But this is not something we should consider at all in this article. Our goal is 100%.
If you can get collectable property for the same money the market offers by its luxury standards, why follow the stereotypes of that market?
If you can get collectable property for the same money
the market offers by its luxury standards,
why following the stereotypes of that market?
HOW DO WE MAKE IT DONE?
- we design in a way to get a WOW effect
to induce a state of slight euphoria in the viewer
- we create visual effects to make exterior and interiors
much larger than they are
- we use many art objects as a part of architectural
design for external and internal decoration
- we use special materials and talanted artisans and
masters
- we use our own factories for production to reduce
the cost