Description

WECITY complies with the provisions of Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European providers of equity finance services for companies and Title V of Law 5/2015 on the promotion of business financing as amended by Law 18/2022 of 28 September on the creation and growth of companies. It is authorized by the CNMV as a Participatory Financing Service Provider, registered under number 9, with a favorable proposal from the Bank of Spain.

Investor, before making your investment, please read the basic information for the investor client, as well as the pre-contractual cooling-off period for inexperienced investors.

Skin in the game: “In compliance with Article 8.2 of Regulation (EU) 2020/1503 of the European Parliament and of the Council of October 7, 2020 on European providers of equity financing, we hereby inform you that partners, managers and employees of wecity may invest in this opportunity. These investments will be made on the same terms as those of other investors without receiving preferential treatment or privileged access to information.”

The investment

The investment opportunity consists of financing part of the costs of building a luxury villa in Teià, Barcelona. The construction work has already started and is currently 53.05% complete.

The plot of land measures 800 m2 and the villa will have a floor area of 610 m2. The villa will have 5 bedrooms, a garden and a private swimming pool, as well as spectacular sea views and being built using top quality materials. The villa is currently in the marketing phase and is priced at €4,900,000.

This loan amount corresponds to Phase II of a total loan of €1,600,000,of which Phase I (€800,000) has already been successfully financed.

The amount ofthe Phase II loan will be €800,000 at a fixed rate and will have a mortgage guarantee of 1^{st degree1}.

The developer has contributed equity to date amounting to 1,354,468.74 € (62.87%), of which 824,825 € has been used for the acquisition of the land and 529,643.74 € for the construction work. The construction costs will be jointly borne by wecity and the developer.

It is estimated that the repayment of the loan to wecity investors, and therefore their exit, will take place with the sale of the property.

Tailor&Bau is the delegated developer of the project, and the development company is Prosperity Grounds, S.L.

Through wecity you can participate in a fixed-rate loan operation with an annual interest rate of 11% over an estimated period of 8 months (6 mandatory) with the possibility of an extension for an additional 6 months.

The payment of interest plus the return of the invested capital will be made at maturity.

The project

Location and surroundings

Teià is the most exclusive residential neighborhood on the coast of Barcelona, located in the Maresme region of Catalonia, along the Mediterranean coast. This charming town is known for its peaceful atmosphere and rich history, although its modern development has been strongly linked to agricultural and wine-making activity.

The municipality has an attractive historic center and a series of nature trails that are popular with residents and visitors alike. Today, it is a town that combines tradition and modernity, with an active cultural life and a growing range of services and shops.

The house is located at the top of the village, known for its impressive views of the hillside and the sea. Teià is more than a place to live; it is a refuge where nature and tranquility meet, offering a perfect environment for those seeking a balance between modern life and the serenity of the natural environment.

Collateral and appraisal

The loan will be secured by a first mortgage on the asset located at Carrer Ramón Llull 7, Teià, Barcelona.

According to the report by SOCIEDAD DE TASACIÓN, the current valuation amounts to €2,002,554.13. The loan to be made to the developer is €800,000, which together with the amount financed in the first phase (€800,000) represents a Loan to Value (LTV) on the current valuation of 79.89%.

The HET value of the asset is €4,203,896.94, and the total of the 2 phases of the loan amounts to €1,600,000, which represents an HET LTV of 38.06%.

Finally, the first drawdown on the loan is for €1,085,132.20, which means an LTV of 54.19% for the first drawdown.

Collateral agent

The constitution, conservation, management, administration and, if applicable, enforcement of the pledge on behalf of wecity’s investors shall be carried out by an entity external to wecity.

In this case, the designated Collateral Agent will be the one indicated in the Fundamental Data Sheet of the investment.

Rating

wecity, as a provider of equity financing services and in compliance with Delegated Regulation (EU) 2024/358 supplementing Regulation (EU) 2020/1503 of the European Parliament and of the Council, provides a description of the credit rating method
of the projects used to calculate the ratings. If the calculation is based on accounts that have not been audited, this shall be clearly stated in the description of the method.

Monitoring

The promoter must justify the use of the funds in each of the applications. The use of the funds by the promoter will be monitored by a company external to wecity.

Compliance with Regulation (EU) 2020/1503 🇪🇺

Risk warning

Investing in this crowdfunding project involves risks, including the risk of partial or total loss of the money invested. Your investment is not covered by the deposit guarantee schemes established in accordance with Directive 2014/49/EU of the European Parliament and of the Council (*). Your investment is not covered by the investor compensation schemes established in accordance with Directive 97/9/EC of the European Parliament and of the Council (**). You may not get any return on your investment. This is not a savings product and you are advised not to invest more than 10% of your net wealth in crowdfunding projects. You may not be able to sell the investment instruments whenever you want. Even if you can assign them, you could suffer losses.

Pre-contractual cooling-off period for inexperienced investors

Inexperienced investors have a cooling-off period of four (4) days during which they can, at any time, revoke or withdraw, at any time, from their investment offer or expression of interest in the participatory financing offer without having to justify their decision and without incurring a penalty. The cooling-off period begins at the moment when the potential inexperienced investor makes an investment offer or expresses interest and expires four calendar days from that date. To exercise their right of revocation, Investors may send an email to the following address: reclamaciones@wecity.io, filling in the “subject” field of the email as follows: “REVOCATION – Name of the Opportunity – Full name of the Investor”. In the event that a monetary contribution has been made in connection with the financing offer, this amount will be returned as soon as possible to the wallet that, as an investor/user of the ‘WECITY’ Platform, has been opened in the Payment Institution ‘LEMONWAY’.

Credit risk

Credit risk is defined as the loss that may occur in the event of non-payment by the counterparty in a financial transaction. In this specific case, the risk that the Promoter will not pay the principal and/or interest of the Loan.

Sector risk Risks inherent to the specific sector.

These risks may be caused, for example, by a change in macroeconomic circumstances, a reduction in demand in the sector in which the participatory financing project operates and dependencies on other sectors. In any case, the investor must bear in mind that adverse economic conditions or cyclical changes may lead to a weakening of the Promoter’s ability to meet its financial commitments in relation to the loan.

Risk of default

The risk that the project developer may be subject to insolvency proceedings and other events affecting the project or the project developer that result in the loss of the investment for the investors. These risks may be caused by a variety of factors, including, but not limited to: (serious) change in macroeconomic circumstances, mismanagement, lack of experience, fraud, financing not fitting with the corporate purpose, failure in the product launch or lack of liquidity. In the event of the Promoter’s bankruptcy, the holders of the credits will be considered as credits with special privilege, as they are secured by a mortgage guarantee, in accordance with the cataloguing and order of priority of credits established by Royal Legislative Decree 1/2020, of May 5, which approves the revised text of the Bankruptcy Law (hereinafter, the “Bankruptcy Law”), except for those amounts that, in accordance with Article 272 of the Bankruptcy Law, should be classified either as ordinary credit or as subordinated credit, as appropriate.

Risk of lower or delayed return

The risk that the return will be lower than expected or that the project will default on the payment of principal or interest.

Risk of illiquidity of the investment

The risk that investors will not be able to sell their investment. There is no active trading market for the loan, so it is possible that the investor will not be able to find a third party to whom to assign the loan.

Other risks

Risks that are, among others, beyond the control of the project developer, such as political or regulatory risks.