hello am also interested pls share the D7
Hi David, I have recently engaged Mercan for the GV options in Portugal. I would really appreciate your info in dealings with them so far. Thanks Christo
I’ll add a “me too”; I would love to hear others’ perspectives on Mercan.
I received several documents today–nicely itemized with actual numbers!–tabulating the expected costs and yields of the various options. The 280K projects have fixed overhead costs of several percent and return no yield other that return of capital. The 350K projects tend to yield 1-2%, after subtracting fixed costs, plus guaranteed return of capital. There is one project that offers a nominal 5-10% yield, minus unknown expenses, rather than the 3% typical of other projects in the same cost band; however, it does not offer guaranteed buy-back.
What do you all think about these various projects, particularly in comparison to the investment fund option? I would be most comfortable if I had clear insights into the financial health of these firms and projects following the financial stress and disruption of COVID. If anyone has a well-calibrated crystal ball to predict the future, do please share what you see!
The Mercan project comparison spreadsheet lists “Annual income” for the Porto Broadway Sheraton project as 5-10%, which seems like more of an estimate or target than a guarantee. I infer that this is a variable rate of return, in contrast to the fixed or zero return of the other options. The sheet notes that this earns the highest annual income while also incurring the highest total costs, and has no guaranteed buyback in contrast to all other projects on the roster.
ok then I think it is reasonable now if it is like this, If the return is conservative I think it is the good deal and trustable
Hi David, I too would love any info you could provide on your experience with Mercan. Thank you!
I spoke with them also. It is a potential option for some people, and I understand why. We have chosen not to pursue them further but here are my thoughts:
- they seem a good, relatively low risk project. Of course the name brand hotels could pull out or the construction company could go broke. They have 12 year deals with Marriott for instance and construction is proceeding on both their current projects so I see this as unlikely. My concern is they also seem like essentially a time-share and we all know how bad those can be.
- The Marriott in Porto will give 3%/year and 1 week stay/year so some return on an annual basis is good. Note, this only begins one construction is completed so nothing for the Marriott Porto project for 2+ years.
- as opposed to a fund investment, you do have to pay the RE fees and taxes as you would for any other RE purchase. This is over 10k.
- I like their potential “guarantee” (for what this worth) that they will buy your share back after 6 years or if your GV falls thru. The Broadway project does not give this guarantee FYI.
- The Hilton is a lower cost option but seems far out of the way and is farther from actually being built.
I just find this topic re Mercan projects cos i have spent too much time on fund option over past a few weeks.
I got Mercan’s Lapa hotel info from various different consulting firm ,so it seems Mercan might have spent more than their peers on advertisement. I hav yet reviewed Lapa appraisal report but my impression is the company looks to be experiences on immigrant projects. I
buy back guaranteed term
cooperated with Marriott, which has credentials in hotel sector.
I keep Questions on below:
would tourists industry be back as normal level it before after Covid -19 ? Hotel will open in 2022, the presentation estimates the occupancy rate will be 68%-70%,which sounds too aggressive based on current mkt perspectives
who would be real capable one to provide back-back guarantee? they said it’s their company in Porto, a developer will provide guarantee. I am so curiously if such promise would be carried out at the end of 5-6yr. The key uncertainties include 1)if the developer’s refinancing amount might have large portion against its capital. If so, buy-back guarantee is too hard to be carried out 2) The risk on construction. They claimed the construction would commence in Oct 2020(I really suspect such timetable under current circumstances ) . even if the construction is kicked off as they claimed on proposal, the whole project would largely depend on if budget capital is fully raised , say around 50Mn . They said they have attracted half of total investors(160), but how’s going on next a few months?
Anything new info you could share? thanks lot!
Hi @mtrom - would love to have your law firm contacts for D7 visa!
HI Olga - wondering if you could share the lawyer contacts from Melanie with me. thank you!!