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| Profit Forecast | | | | | |
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| Projected Growth & Gross Profit Forecast over 5
Years On Grand Hotel Delhi
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Example using prices of a studio apartment
Price $379,000 list price pre pre launch
20% payment paid on reservation $75,800
Stamp Duty & Taxes = 0
Legal Property fees = 0
Furniture Package $00000 included in the price
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Total maximum expected outlay at reservation $75,800 |
Mortgage also available at 95% developers loan
5% ($18,950) payment required on reservation, and Monthly mortgage payments thereafter. |
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TIME |
Projected Property Value (Assuming compounded capital growth below) |
| Growth |
0% |
10% |
20% |
30% |
40% |
1 Year |
$549,000
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$603,900
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$658,800
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$713,700
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$768,600
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2 Years |
$549,000
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$664,290
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$790,560
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$927,810
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$1,076,040
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3 Years |
$549,000 |
$730,719
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$948,672
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$1,206,153
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$1,506,456
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4 Years |
$549,000
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$803,791
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$1,138,406
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$1,567,989
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$2,109,038
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5 Years |
$549,000
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$884,170
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$1,366,088
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$2,038,398
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$2,952,654
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TIME |
Projected net Profit (Rental Income) |
| Profit |
0% |
10% |
20% |
30% |
40% |
1 Year |
$49,324
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$54,256
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$59,189
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$64,121
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$69,054
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2 Years |
$49,324
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$59,682
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$71,027
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$83,358
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$96,675
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3 Years |
$49,324
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$65,650
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$85,232
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$108,365
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$135,345
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4 Years |
$49,324
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$72,215
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$102,278
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$140,874
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$189,483
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5 Years |
$49,324
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$79,437
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$122,734
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$183,137
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$265,276
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Total profit in
5 yrs |
$246,620 |
$331,240 |
$440,460 |
$579,855 |
$755,833 |
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| Taking a 5 year investment at a very conservative
20%, capital growth has grown to
$1,366,088
and Net
rental income to $440,460 |
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| Total Income
$ 1,366,088 + $ 440,460 = $1,806,548 |
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Less outstanding Purchase price or Mortgage
$379,000
Less selling commission fees 6% $81,965
Less other costs & fees $5,000
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Total cost s $379,000 + $81,965+ $5,000 = $465,965 |
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Total Profit $ 1,806,548 - $465,965= $1,340,583 |
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Initial Reservation Investment at first phase
price $75,800
Profit = $1,340,583
Tax is payable on any profit made under government laws
Investment return is in excess
of 1,700% |
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The calculations above are based on the purchase of a studio at pre-release prices, the property price used in the projected growth chart provided by the developer and is calculated at completion prices, showing you what you can achieve if you buy on the first phase of a development |
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If you keep the property 5 years after completion you could
easily
be seeing your investment grow by more than 1,500%.
Yes that�s right 1,500%. Invest
$75,800
in a building society over 5 years with compound interest at 3% gross and you will see an estimated total gross return of
$12,072 only. |
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| A Greater than 300% Cash on Cash Return with No Appreciation Necessary: The beauty of the Preferential Investor opportunity is that it gives the Investor the clear prospect of better than a 300% return on his/her cash investment without any need for the units to appreciate in value. Suppose the investor wants to resell his position 6 months down the road, say in Nov - Dec 2006. Here’s an example: |
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| 300%+ Cash on Cash Return |
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A Greater than 300% Cash on Cash Return:
(No Appreciation Necessary) |
Public Price of Unit in Nov:
Investor Purchase Pricing
Built-In Investor Profit:
Investor 5% deposit:
No monthly payments for 6 months
Total payments paid
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$409,000
$379,000
$ 30,000
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$ 18,950
$ 0
$ 18,950 |
Profit of $30000 on investment of $ 18,950 = 158% Gross return in 6 months.
Cash on Cash Annual Return = 316% Gross return (presumes unit is resold in 6 months)
Returns are net of all commissions, fees and profit splits. |
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Commissions on resale paid to developer is 1% of the sale price = $4090 Plus 10% of the $30000 profits = $3000. Total commission paid = $ 7090.
In this example the investor in 6 months get $ 22910, and the developer makes $7090.
It is an illustrative example only and should not be construed as representing any actual result or presumed actual result. |
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If the unit has appreciated by a mere 15% in price and sold for $470,350, The average appreciation has been over 50% per year in this area during the last 4 years. The Investor profit now comes to $91,350.
Commissions on resale paid to developer is 1% of the sale price = $4,703 Plus 10% of the $91,350 profits = $9,135. Total commission paid = $ 13,838.
In this example the investor in 6 months gets $ 77,512 in profits on a $18,950 investment, and the developer makes $13,838.
This is a WIN WIN situation both for the Investor and developer. It is an illustrative example only and should not be construed as representing any actual result or presumed actual result. Of course, it is needless to say the longer the investor holds the greater are his profits. It is recommended that the investor sleeps on it for 2 –3 years at least and let his profits grow. In fact the real profits, growth and appreciation will come when the units start delivering the huge rental returns. Instead of holding for life-long rental profits, if reselling is the buyers goal, then on completion would be the ideal time to resell to book the maximum profits. |
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| All calculations and prices are approximate. |
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| The Process: The actual reservation of units will be on a first come-first serve basis generally based on the timing of $1000 deposit received. In other words, an effort will be made to accommodate first those who commit first. |
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| ASSIGNMENTS |
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| Reservations are FULLY ASSIGNABLE. You can sell them before you close. This will give the buyers a major advantage. |
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Reservation Assign ability: Are fully assignable. Yes, reservations can be assigned without seeking permission from the developer and free of any costs by the reservation holder. This election may be made any time after the first 6 months following the reservation date. Developers around the world now rarely ever grant this right to a buyer. It is certainly a big benefit to the buyers now turned sellers. |
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| Example: |
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| buyers now turned sellers have 2 options on selling. |
- All investors who have made reservations on the units can join the developer’s resale pool, and sell their unit at the then current price. In this case the sellers have to pay a subsidized commission to the developer. The new buyer pays no commission.
- The other option the investor gets a buyer from the resale pool or from the market. The new buyer pays your invested sums plus a premium to you as your profit and you assign your reservation in the buyer’s new name. The seller pays no commissions or assignment fees, but the new buyer has to pay 6% assignment fees to get the reservation registered under the buyer’s new name.
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| The seller can select whichever options suits him/her the best. Whichever option will make him/her the most profit. |
For the transaction to go smoothly the developer can provide his intermediary services free of any cost. They can act as collecting agency for the funds received from the new buyer, and send funds to the seller. All Bank charges or transaction charges will be borne by the seller. |
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Disclaimer: Although this is clearly a preferential buying opportunity, the Buyer should be aware that no investment or return on investment is ever guaranteed. No representation is being made that your investment or return on investment will be the same as or resemble the examples shown above. In fact, no representation is made that there will necessarily be any return on your investment. The examples are just one of many possible investment outcomes and are for purposes of illustration only. The Buyer investment, in this case, is in a project to be constructed. Although the expectation is that this project will be built as planned, we make no representations or promises that the project will proceed as planned. Investor funds will be held in secure escrow/trust accounts and all funds will be returned in the event that the project does not proceed. |
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The information herein is merely illustrative and promotional in nature, and does not represent a contract, guarantee or specific representation regarding any particular contract. No representation is made as to the success of any project, the ability of a purchaser to find a buyer to take assignment of a purchase contract of a unit, or that the prices within a particular project will rise. Real estate buyers should understand that if held for investment purposes, there is a risk that returns from other investment vehicles � such as a stock, bonds or other property � could be higher. Accordingly, there is no guarantee that a pre-construction purchase contract represents the best possible investment relative to other possible uses of a buyer's money. Buyers should do their own due diligence and consult their own investment and tax advisors about the suitability of a pre-construction purchase contract for their particular needs and situations. The purchase of a pre-construction contract is a purchase of a particular real estate unit. Accordingly, it is not intended to constitute a security. |
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The information provided here are calculations only. The rates, revenues and returns are expected estimates only based upon the analysis of market conditions and hotel management activity in the Delhi area. |
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East West Developments makes no recommendations whatsoever with regard to the decision of any prospective buyer to purchase a unit by the developer, other than to recommend to any prospective buyer that he/she should consult with his/her independent investment advisor, tax consultant and legal counsel. |
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East West Developments is not registered with the Securities and Exchange Commission, or licensed by the National Association of Securities Dealers. East West Developments disclaim any responsibility for the project or portfolio performance and makes no representation or warranty, express or implied, as to the percentage of return of investment to any purchase at the Condo Hotel Delhi. |
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