Thanks David

Yes, I agree - the development on the face of it does look quite impressive.

Nice to know that Profit keep their website updated with recent pictures.

Not too sure what the land is fenced off - wouldn't have thought it was much of an issue though.

I did find out why those apartments on the Rednet website were advertised less than the value i-PA recently indicated and what was mentioned at the last investment performance update.

The units on the rednet website are resales.

Apparently, there is an investor club in Poland that also were offered these units aswell (looks like the club are linked to Rednet) probably at the same time the units were offered to us.

Some investors who obviously bought these at may be less than 6000PLN per sqm are now looking to sell - the price indicated is 6200 - 6600 and I think these are the (less popular?) 2 bedders. Obviously looking for a quick sell and hence the reason for the favourable price.

I think I'm right in saying that not all of the units allocated to PS were taken up. I wonder if Rednet then took up the residual via their own investment club or whether this was in addition to what was offered to us?

I still expect the market value to be at least 7000PLN per sqm based on recent i-PA information which in turn was supplied by Rednet.


Regards

Sanj

Thanks for the info Sanj. Interesting news about the redNet investment club. I have to say Profit seem a very efficient developer; everything appears to be running to schedule with regular updates on an easy-to-access website.

Cheers

David B

Hi David

How is your mortgage offer with DB progressing?

I was in a similar position to you a few weeks ago and I'm still waiting for an update!

Pictures of the completed development now on the website - as I said before, I'm pleased with the quality of the development from what the pictures suggest.

Regards

Sanj

Hi Sanj

Like you, after a verbal approval and offer from DB there has been no word for months. Have decided to go ahead with BZWBK instead. I agree, the development is looking very good. Hoping the Wroclaw market will start to pick up again because I think Balcony Gardens should do very well. Are you still confident of the 7,000PLN sqm valuation?

Cheers

David

Hi David

DB have some good terms but are painfully slow - perhaps a side effect of the credit crunch - caution being the watch word (although 5 months to process the application is excessive).

We can only go with recent post strategy information which suggests 7000 per sqm is a realistic figure - probably about right for 1 bedroom apartments.

However, its actual resales data that matters and this is what PS and Rednet are focusing on as its the only real indicator of the state of the market.

In fact, Rednet have moved from producing monthly reports to quarterly reports on the state of the Polish housing market and for the first time last month used actual resale data which is a great move forward.

The only thing I'm slightly disappointed with is the 18% pa growth predictions for this market over the next few years (stated in 06) as indicated in the original investment report only for this to change to 5-10% indicated recently.

I don't base my investment decisions solely on these predictions - no one has a crystall ball....but if you start entering these rates in a cashflow spreadsheet model and quoting the ROI's you are creating expectations.

Best to either :

a) Not quote any capital guestimates at all and just talk about fundamentals of supply and demand (although may not be as appealing from a marketing point of view)

b) Don't make point estimates but rather model using a variety of growth assumptions either linearly (eg 0%, 5%, 10%, 15% etc) or using some other kind of pattern..(eg 20% 15% 5% 5%) as one model point and this (eg 15% 5% 5% 15%) as another model point etc

It is only guesswork but then clients can have a feel for a range of scenarios and are not distracted by this one headline figure.

Hope this makes sense.

Regards

Sanj

Hi

How are fellow investors progressing with fit out etc of their units?

Anyone at a stage where there units are ready to be rented out (and haven't gone with iPA) ?

Apparently final handover to Rednet has not been completed due to 'outstanding issues' with the units.... whatever that means.


Regards

Sanj