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 participative financing 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 in the registry 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, it is hereby informed that in this opportunity partners, managers and employees of wecity may invest. These investments will be made under the same conditions as those of other investors without receiving preferential treatment or privileged access to information.”

The investment

The developer ALFA INVESTMENTS is requesting financing through wecity to finance part of the acquisition of land through a special purpose vehicle, which will be used for the construction of a 226-apartment complex in Travessa de Manariz de Baixo e Rua de Manariz, in Gondomar, Porto.

The asset has a total area of 10,200 m2 and a buildable area of 24,027 m2, where a gated residential complex with swimming pool, gym and common areas will be developed.

At the urban planning level, the request for prior information has been favorable and the building permit is pending approval. At the commercial level, 25 out of 226 (11%) are reserved.

The project will be financed through a mortgage loan for an amount of €2,000,000, at a fixed rate, which will have a first degree mortgage guarantee, with a duration of 12 months (+6 months of possible extension).

The acquisition price is €2,500,000 and to date, the developer has contributed €250,000 of its own funds as an acquisition reserve and will contribute an additional €600,000 at the time of signing. 850,000, i.e., the developer’s contribution will amount to

As collateral, the developer assigns the plot of land that is the object of the project and the property is valued in its current condition at €2,814,000. The valuation of the finished building amounts to €47,272,810.

The exit of wecity investors is planned with the entry of bank financing, or with the amounts obtained from pre-sales.

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

AInvest

In this opportunity, AInvest is applied.

The project

Location and surroundings

The Gondomar area offers a quiet residential environment within the metropolitan area of Porto, characterized by single-family homes and low density. It is an attractive location for those seeking spaciousness, privacy and more competitive prices than in the urban center, while maintaining a good road connection to the city and its main centers of activity.

In the immediate vicinity there are natural areas such as the Douro River, ideal for leisure and outdoor activities, as well as green areas and nearby trails. A few minutes away you will find shopping areas and services in Gondomar, as well as quick access to key points of Oporto such as the historic center or the Ribeira de Oporto, one of the main tourist and cultural centers of the city.

Mortgage collateral

The loan will be secured by a^1st degree mortgage on the asset, located in Gondomar, Porto (Rua de Manariz).

According to the appraisal report made by Tinsa, the Current Appraisal amounts to 2.814.000 € and the Appraisal in Hypothesis of Finished Building (HET) to 47.272.810 €. The loan to be made to the developer is € 2,000,000. This implies a Loan to Value (LTV) HET of 4,23% and a Loan to Value (LTV) on first drawdown of 71,07%.

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 loan agreement.

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.