PROJECT SUMMARY
Project Name: SC VCX, LLC
Project Type: Net Leased, Two-Tenant Commercial Building
Location: Max-Schmidheinystrasse
CH-9435 – Heerbrugg
Canton of St. Gallen, Switzerland
Site Area: 117,230 current building space on 83,259 square feet of land
Parking: 112 outside parking spaces, and 34 underground parking spaces
Tenants: Vectronix AG (90%)/APM Technica AG (10%)
Lease Term/Options: Until 6/30/2021 with one 10 Year Option to extend until 6/2031
Owner Responsibilities: Roof & Structure, Property Taxes & Insurance
Management: LLC: Sonnenschein Capital, LLC; Evanston, Illinois USA (1.5% of annual rent)
Property: EIKO Immobilien AG; Zug, Switzerland (2.0% of annual rent)
Rent: Gross Annual Rent Initial (The Property) of CHF 2,047,782
Gross Annual Rent of Expansion upon completion (estimated) of CHF 225,000
Total Projected Rent in 2012 (upon completion of Expansion) of CHF 2,297,367
Annual Escalation: 100% of Swiss CPI on an annual basis (estimated in the Cash Flow Model to be 1.25% per year vs. the 20 year average of 1.725%).
Pro Forma Returns: Returns are based in local currency and will vary based on the fluctuation in the U.S. dollar vs. the Swiss franc (“CHF”) and the escalation of Swiss CPI.
10 Year (1st Yr) Projected : Cash-on-Cash Returns/Quarterly Distributions (“COC”) are projected to be 7.0% on amount invested in the 1st year: and 8.0% annual average COC over 10 years.* These figures are based on Net Returns after all debt, projected Swiss GmbH & US LLC accounting costs, all property & LLC management fees, Cap-Ex, property taxes & insurance, currency fluctuations, but before any income taxes*. Based upon actual experience on other Swiss Sonnenschein deals structured the same way, income taxes should be minimal. There are no adverse tax consequences to an investment made by a U.S. investor into a Swiss real estate investment on an in-direct basis. A U.S./Swiss Tax Treaty exists.
10 Year (1st Yr) Projected: Return-on-Equity (“ROE”) to investor Members is projected to be 10.1% in the 1st year & an average annual ROE of 11.1% over 10 years. This estimate does not include any increase in the original purchase price that may occur upon the ultimate sale of the Property. Projections are based on Net Returns after all annual fees & expenses (*Note: projection based on an estimated USD/CHF conversion of 1:1).
Transaction Terms (Total – Including Expansion):
Gross Transaction Price: CHF 39,673,000 million (Total of all fees & expenses)
Loan Amount (in Swiss Francs): CHF 25,305,000 (67% LTV)
Loan Terms: 5.5 years of fixed rate loan @ 2.66% (Estimated Refinance at 2.75%
in years 7-10)
Flat/fixed amortization of 1.8% of the Initial Loan Principal balanc
per year
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