Since PS are in Prague again I'm doing some background due dilligence. I just stumbled across this: http: / /www .citymayors .com /features /cost _survey .html Prague sneaks in there as the 50th "most expensive" big city. I've not looked at all the details for this survey but making the assumption that "most expensive" includes the cost of property as an important factor I'm rather worried that Prague is already in the top 50 globally (mind you, it is interesting to see cities in Brazil and Africa that rank higher than Prague).

What are other peoples inturpretation of these figures? Is my above assumption correct? Do we really believe that Prague is still playing 'catchup' with major cities in USA and Eastern Europe (and hence we can expect long term, above average, growth in property prices like 13%) or are we more likely to see the growth rate dip below that of major growing cities (such as London) in the medium term???

I'm still trying to get my head around the guaranteed rental deal on this investment. Why if a developer could sell out their units without entering into such an arrangement would they agree to it? If there is such demand in Prague before the 2008 tax changes, this would be an unnecessary sweetner. Meanwhile, the rent guaranteed on a studio is around £630 a month, which even in the UK is steep. I know this is a luxury development, but a quick scan of Czech rental sites shows you can get some spacious, very well located apartments in Prague for about £400 a month. It would seem one would be using the insurance of the 7% yield for 3 years to go for the pure capital growth over that period. But as Peter points out, will that be sufficient? And who will pay such pricey rents after the three-year period?

Judging by the general lack of replies to this thread I'm guessing that not many people are interested in doing due dilligence on this deal. I guess it is not that interesting compared to the Brewery last month?

Peter I think it is a very interesting deal. I have been out to see the site and it is in a reasonable location that in 5-10 years should be a grat location. The development is one of a kind so although it is pricy it should attract interest from future tenants and purchasers. The issue for me is the rental potential in the early years - I think it may take sometime to take off. For that reason the 3 year rental guarantee is absolutely key and I am only interested if that is watertight. It does appear, with some fanfare in the prospectus, but I can't find mention of it in the legal documents. I have asked Simon Blakebrough, the PS Investment Director, and the lawyers for confirmation that this will be tied down with a contract but they havn't replied yet. Simon assured me verbally that it was 'material' and therefore if there was a problem with the contract then the Finders Fee would be refundable. On that basis I have signed up. Anybody else out there taken this deal? What are your thoughts?

I hope I made the right choice here. It seems to me to be a good deal and I'm a bit of a pessimist. 3 years rent guarantee at 7% so I don't have to think about this investment for 4 years or so. If you believe, as I do, that the Czech market is rising significantly, this has to be a good deal. It may not be Romania in potential price rises but I know that for the next 4 years I don't have to give this a second thought. The developer is well respected in Prague and unlikely to go bust. I think (hope!) that PS has done due dilligence here.

PS - Any comments here??

I was very drawn to it, though I have passed it by. Location is very good, though probably Holosovice and Karlin similar. I did wonder if it was too high rise, though the quality looked excellent. Best of luck John, I think you have made a good choice

Hi Peter, Central Park ended up being one of our most successful deals ever, through both interest and confirmed units. The development is certainly interesting; I visited the site with Simon last month and was blown away by the spec and views across the city. Kind regards, Martin Grainger Purchase Support Manager

Had a couple of questions that I've sent on email that need answering. Can you get back to me on them as I want to pay the finders fee once I get your answers. Cheers, John

Hi John, I have emailed your answers to you. Thanks, Martin