The very first investment project was a family flat in Prague 9. It was a no-money down deal, and all capital was raised and financed.
Property Parameters
Location: Prague, Czech Republic
Year of Entry: 2020, Covid Maturity: 2023
Investment Strategy: Force appreciation with renovation and upgrading to modern amenities, hold for natural appreciation, refinance, convert to rental property.
Size: 63m Cellar: 7m Balcony: Two, 10m and 20m squared Parking: Yes
Forced Appreciation Strategies:
Negotiated to use the neighbor's roof as a new, second terrace for the flat
Walls were demolished to create a bigger bathroom, the shower was built-in to maximize space
Old hardwood floors, doorframes, and doors were salvaged and restored
Kitchen was relocated to another room, pipes re-mapped
Custom, thought-out design work was done to each room
Return on Investment
Purchase Price | 4,500,000 CZK |
Cost of Reno/Upgrades | 500,000 CZK |
Sale Price (as at Sep 2023) | 7,200,000 CZK |
ROI (Cost Method*) | 44% |
ROI (Out of Pocket Method**) | ​82% |
*ROI (Cost Method)= (Sale Price - Purchase Price) / (Purchase Price + Reno Costs)
**ROI (Out of Pocket Method) = (Value at Maturity - Initial Purchase Value) / Sale Price
Returns To Investors
Initial Investor Equity | 800,000 CZK |
Number of Investors | 2 |
Investment Gain* | 2,200,000 CZK |
Distributions Paid to Investors** | 1,760,000 CZK |
Equity Multiple*** | 2.75 X |
IRR**** | ​10.28% |
*Investment Gain = Sale Price - Purchase Price - Reno Costs
**Distributions Paid = Investment Gain * 80% Profit Split
***Equity Multiple = Total Cash Distributions / Investor Contributions
****IRR: Risk weighted average annual return. More info here
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