I’ve been looking at Mercan for the Portuguese GV because they offer GV qualifying investments at the lowest level of only 280K Euros.
I’m looking at the Lagos Marina project, and I’m a bit concerned.
Doing the math, the project costs 400K Euros per hotel room (each investor pays in 280K Euros, 107M Euro total investment to renovate 270 rooms), and it’s just a renovation project - there is already a hotel there. This seems extraordinarily high, making me question the legitimacy of the project in its entirety. How can they turn a profit if rooms in the area go for just $100 a night and it costs so much to renovate the place? A profit is required to buy back my share.
The buy back is not truly guaranteed, if Mercan fails to buy back your share when you demand buy back, they can pay you 3-4% annually rather than buy back your share. This is a very low rate.
They offer no analysis to support profitability, no income analysis, no comparable market rates to justify the valuation. The information provided was just pretty renderings and a year-6 valuation of 113M Euro which they claim was based on income analysis.
Can anyone speak to these questions? Of course Mercan will give their answer, but I’m curious what the group thinks.
I thought Mercan was totally legitimate but after identifying those two questions, I started to wonder whether this is a pyramid or other sort of scam.