Summary Of A Syndicate

1. funding round to establish a syndicate

For each syndicate, Thames Property Nest Eggs offers a limited number of individuals (10 max per 'Nest Egg'), the opportunity to jointly invest in a single residential property, to be cash-purchased in London.

There are 5 levels of 'Nest Eggs':
10 x £25K for a £250K property 'Nest Egg'
10 x £35K for a £350K property 'Nest Egg'
10 x £50K for a £500K property 'Nest Egg'
10 x £75K for a £750K property 'Nest Egg'
10 x £100K for a £1m property 'Nest Egg'

Applications from prospective syndicate members are vetted by Thames Property Nest Eggs and Moore Stephens Accountants. This involves, amongst other things, receiving evidence of identity and full anti money-laundering due diligence. Acceptance of applications is entirely at Thames Property Nest Eggs' discretion.

2. establishment of a 'Nest Egg' company

When a new 'Nest Egg' opportunity is launched, Moore Stephens Accountants establishes a limited company and bank account, on behalf of the investors.

The 'Nest Egg' company and bank account is controlled 100% by the members of the syndicate, who also hold 100% beneficial interest in the new 'Nest Egg' limited company.

3. sourcing of properties

The members of the syndicate will receive details of suggested properties which have been sourced by and vetted by us. Those properties will generally comply with the following brief:

• Location within M25 London Orbital Motorway, but with emphasis on new CrossRail routes, and designated regeneration areas.
• 100% cash purchased.
• Properties that require refurbishment/upgrade.
• Properties purchased as repossessions or at auction/pre-auction.

The details of each property will include plan as to how the property may be refurbished, and will include two contractor quotes to carry out that work.

The approval of any particular property purchase will be entirely within the control of the syndicate members, as will be the choice of the building contractor appointed to complete the refurbishment works.

Budget Allocation: As a 'rule of thumb', c. 80% of each 'Nest Egg' fund is used for the property purchase, 10% is used for the refurbishment, 5% is used to cover all fees and 5% is held as a contingency amount.

4. property refurbished

In accordance with syndicate members' instructions, we arrange for the relevant contractor to proceed with the refurbishment work. Thames Property Nest Eggs monitors and supervises progress, and arranges all stage payments on the instructions of the syndicate.

5. rental income

In the example of a 'Classic Nest Egg' (5 years hold), all rents (less agency fees at 10%) are paid into the 'Nest Egg' bank account, month-on-month. This strategy achieves two goals. Firstly, it constantly sustains and builds the 'Nest Egg' bank account, and therefore protects syndicate members from future unforseen costs with the property. Secondly, it enables the shareholders to vote annually to award themselves a potentially tax free annual dividend, distributed from within this growing fund…always of course, ensuring that a sensible contingency fund is held back.

6. sale of the property

As the norm with a 'Classic Nest Egg' investment, each 'Nest Egg' property is sold at 5 years from purchase. The 'Nest Egg' syndicate can vote to extend the term however, for up to a year, if it is felt that market conditions dictate, and if 100% of syndicate members agree on this strategy.

With a 'Fast Track Nest Egg' investment, each 'Nest Egg' property is sold immediately after refurbishment.

At the point of 'Nest Egg' property sale, 100% of all profits are distributed to the 10 'Nest Egg' syndicate members, after providing for any costs or liabilities. On instruction from the 'Nest Egg' syndicate, the 'Nest Egg' company and its bank account are shut down.

7. fee structure

a. All individual investors, at any 'Nest Egg' level, pay a £825 (per share) 'Administration/Set-Up Fee'

The fee is payable with your syndicate application and is in addition to your funding commitment for the relevant 'Nest Egg' syndicate.

This fee is fully refundable only in the event of a failed funding-round, the timescale for which is 3 months from the point at which investment funds are called-in.

No other fees are charged to individual members of the 'Nest Egg' syndicate.

b. Once Thames Property Nest Eggs has sourced and completed on a property purchase, a 'sourcing fee' of 2.5% of the 'Nest Egg' value, is charged to the 'Nest Egg' company. A subsequent fee of 1% is charged for the sourcing of refurbishment contractors, and the monitoring of the refurbishment process, to ensure that the upgrade is completed on time and within budget.

c. At the point of sale of all 'Nest Egg' properties, all profits are shared between the syndicate investors and Thames Property Nest Eggs. Thames Property Nest Eggs takes 10% of all gross profits and the 'Nest Egg' company takes 100% of all subsequent profits for its shareholders. This rewards structure ensures that we buy well, refurbish well and sell well on behalf of the investors.

d. All fees for 'Nest Egg' company formation, all annual accounts work, Companies House and HMRC returns (shareholders and corporate tax returns), and eventual company wind-up, and distribution of profits to shareholders, are invoiced to the 'Nest Egg' company direct by Moore Stephens Accountants, at an annual fixed fee of £2400.

e. All legal fees for acquisitions and sales of properties, including Land Registration and HMRC (Stamp Duty) payments, are invoiced to the 'Nest Egg' company direct by Royds Withy King Solicitors at an average fixed-fee of £1300 - £1700 (exclusive of disbursements).

f. In the case of 'Classic Nest Eggs', Thames Property Nest Eggs charges an annual fee to the 'Nest Egg' of £1000. This is for the management, coordination, and administration of the 'Nest Egg', as well as coordinating/implementing all voting decisions, and being the point of contact for all 'Nest Egg' investors.

g. In the case of a 'Classic Nest Egg', and post property refurbishment, Thames Property Nest Eggs acts as letting agent for the syndicate and identifies suitable tenants for the 'Nest Egg' property, managing the tenancy throughout the 5 year period, at a below London market rate of 10% of the rental income. Thames Property Nest Eggs reports monthly to all syndicate members on the status/progress of their relevant 'Nest Egg' account.

h. When instructed to do so by the 'Nest Egg' syndicate, Thames Property Nest Eggs advertises the property for sale on the open market. A sales fee of 1.5% is charged for coordinating the sale of a 'Nest Egg' property.

8. fee structure for a 'Solo Nest Egg'

All 'Solo Nest Eggs' are by definition, bespoke, one-off investment projects. All such projects are therefore quoted for, on a case-by-case basis. Once we have agreed an exact investment plan with the investor, we provide a personalised fee quote.