Belgian crowdlending platform Beebonds is offering investors an opportunity to cofinance the Arche coliving project in Luxembourg. The investment is offered through a 3 million euro green bond, the firm said.
The Arche project is located in Bettembourg, one of Luxembourg City’s main peripheral municipalities. It is the first joint project of the company Picaroon SA. This Luxembourg-based company, founded in 2011, is active in the sale, rental and purchase of ships, as well as in setting up real estate projects.
“This is a way for the younger generation to access the very expensive housing market in Luxembourg,” Joël Duysan, CEO of BeeBonds, told Investment Officer.
Coliving space
“We are going to issue a green bond to finance a coliving project in Luxembourg,” said Nicolas Erodiades, the promoter of the Arche project. “Indeed, this project is extremely ecological. Specifically, it involves the construction of six four- to five-bedroom flats (coliving) and large communal indoor and outdoor spaces.”
The project’s environmental objective is to minimise the impact of the building’s construction and energy consumption, while complying with Luxembourg environmental standards.
The fundraising sought, through the BeeBonds platform, is for up to €3 million, at a gross annual interest rate of 9 percent over two years. “This is not a capital-guaranteed investment, but we will have a first mortgage on the land to provide maximum security for BeeBonds investors,” said Duysan.
Based on the project’s expected cash flow, investors will be repaid within 24 months. Construction will start in the second quarter of this year for an estimated total cost of €5.3 million and an estimated total sales price of €12 million. Completion is expected in the fourth quarter of 2024. The project could be sold to a single investor.
Belgium lags
In terms of crowdlending, Belgium is far behind its neighbours, Duysan said late last year.
By 2021, crowdlending raised more than €1 billion in the Netherlands, €5 billion in France and around €15 billion in Spain, compared to only €100 million in Belgium. “Banks are still reluctant and savers wonder if the returns of 8-10 per cent offered are not fraudulent. They are not used to such returns at all, but we need to change people’s minds,” said the BeeBonds CEO.
“Crowdfunding platforms are democratising direct and private funding for certain projects. We offer the possibility to invest small amounts under the same conditions as a €100,000 investment. The latter amount is not named by chance, it is the amount from when a financing is considered private.”
This article originally was published on Investment Officer Belgium.