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OUR FLAT PACK CLT MODULAR NEW BUILD HOME, IS HERE!

It is quite a momentous day for Target Five, as our team are onsite at our project in Newland Street, Worthing, as our CLT construction (Cross Laminated Timber carbon sustainable development) has arrived from Austria.

25 tonnes of materials, shipped over on the back of an artic lorry via the fabulous team at Stora Enso. There are 14 packs which are positioned sequentially for the build progress, very much like Meccano but on a mammoth scale! not that we are daunted or anything. This is a first for T5 re: modular building and we are very much learning enormously as we go along with our trusted team and guides at Olive Modular with our PM Tim overseeing.

To the plan then, the main construction will take circa 2 weeks! starting at the rear back gable and working towards the front pavement.

By using a Cross Laminated Timber (CLT), Modular Construction designs and building methods we will be delivering low carbon results with high quality standards compared to traditional methods of constructing developments re: the use of cement and how this impacts CO2.⠀Creating Energy efficient, Environmentally beneficial buildings.

We will keep you updated of course with progress, it’ll be coming thick and fast now!

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NEW DEVELOPMENT PROJECT – BAYFORD ROAD, LITTLEHAMPTON

Our latest Littlehampton project is underway. This mixed use property, consists of a commercial unit on the ground floor, which was recently used as a cafe with a 2 bed maisonette above.⠀

Target Five’s plan is to convert the ground floor commercial into a one bed apartment (plans currently being drawn up by our Architect. The maisonette above will be developed from a 2 bed, 1.5 bathroom, to a 3 bed with 2.5 bathrooms. By repurposing the kitchen to a bedroom with a separate open plan kitchen/living space.⠀

Our builders are onsite and have started the rip out, which is casuing a bit of a headache already as they have identified condensation spores, as there are no damp proof membranes, in fact we have daylight through the slate roof tiles! so a re-roof is in order.⠀

We will keep you up to date as this development progresses.

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STAGES OF PROPERTY DEVELOPMENT – DUE DILIGENCE

In the third of Sven’s video series on The Stages of Development, he is looking at the key points when undertaking Due Diligence:

The 4 Key Points To Follow:
– Legal due diligence; looking at searches, land registry, titles.  Are there any easements or covenants?

– Physical site due diligence; boundaries, topographical survey, soil samples, percolation tests.  Some of these tests can only be done at certain times of the year, so you will need to factor this in, especially if you’re offering option agreements/subject to contract agreements.

– Planning due diligence; MOST IMPORTANT.  We recommend using a planning consultant! This is where the value is most definitely added!

– Construction & onsite due diligence; is it feasible? What are the constraints, especially for airspace developments, mixed use conversions or mews developments.

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EXCHANGED – BROADWATER ROAD, WORTHING

Yesterday we exchanged on Broadwater Road, Worthing, a property we sourced and secured for our returning investor client. This property came with plenty of challenges throughout the conveyancing period, one of which was Japanese Knotweed!! but with the Target Five team on hand this was another issue we were able to overcome, along with the perseverance of our associates @starpropertyuk the sellers, we were both able to get the property over the line.

The property is a freehold mixed use property, comprising of a vacant ground floor commercial premises with a large flat above, with an extensive rear garden accessed via a road to the rear offering development potential (STPC).

With the Japanese Knotweed treatment plan in action and our planning application in here’s our brief for the property:

– Retain and refurbish the commercial unit
– To the rear we hope to extend and create a separate 1/2 bed garden apartment STPC
– Upstairs we will be creating a 4 bed coliving HMO

We will of course keep you up to date with how we progress with this project.

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BAYFORD ROAD – SUCCESSFUL ROI

The figures are in on our most recent development, Bayford Road, Littlehampton.

We started our Bayford Road project in February and completed at the end of June and is now fully let!

The period terraced property was originally 5 bed, spread over 3 floors, which needed to be totally gutted. In doing so we were lucky enough to uncover exposed brickwork to all chimney breasts and brickwork to the hallway, incorporating this into the design theme for feature walls.

We have created an 8 bed HMO with 7 bathrooms, designed for professional sharers.

Purchase Price £220,000

Build Costs £150,000

Refinance £555,000

Rental Income £56,640

ROI 35.6%

Gross Yield 10.2%

We have very happy investors and even happier residents!

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HMO’S ARE THEY RISKY?

I have heard a lot about people moving away from HMOs due to the risk. I understand it – many places are over concentrated in therefore occupancies and refinance valuations have dropped. This is something we saw in Brighton – the student market became saturated and rents and occupancy dropped.

Does this make them bad investments? It depends on you and your product. Are they hard work – yes, is there more regulation – yes, is the competition fierce – yes. So if you are looking for an easy hands off investment, where occupancy will always be constant and you will not need to reinvest in your asset then HMOs are not for you.

If, like us you are professional landlords and developers, happy to put in the work and actually enjoy the experience of creating nice places to live that is relevant to the market and prepared to reinvest and reconfigure assets so that they remain relevant – then they are great investments – AS PART OF A BALANCED PORTFOLIO. Do I just own HMOs, no.

Do I continue to buy them, yes! HMOs are moving on, the trend is with Coliving – shared living by choice, with much more consideration to the quality and practicality of the property to reflect the needs of the market. HMOs are here to stay, it is not that people only stay in them out of necessity but that they now do so out of choice, better for many that than a lonely studio flat or bedsit.

SO there is a market and they do work IF you do it right and CONTINUE to do it right. Do not oppose regulation, it is usually done to improve standards and protect both landlords and tenants. Embrace it and even encourage it, get ahead of the wave, become a thought leader and get involved in the conversation. 

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CONSIDERING INVESTING? OUR TOP TIPS

Know your end game – When do you need the money returned & what interest are you hoping for.

Who is as important as what – The project is important but you need to know that you are investing with the right people, get to know the people around & behind the project, understand them, their reason, moral stand points etc. Never give a company or organization money on a first conversation, we would never ask someone we didn’t know to invest with us, we like to know who we are working with you should too.

Learn about the project – Do your own research into the project the money is intended for, what will it be used for in the project & how will the company deal with problems & challenges.

Ask about a track record, success’ & failures.- You will learn a lot about the people you will be investing with by how they deal with problems & how they react to being asked challenging questions. A reputable, confident & successful property company will have dealt with a fair share of issues & will not have a problem discussing how they overcame them with any potential investor.

Ask what securities are available – There may be an option for a second charge or deed of priority; it may secure your funds more, but be mindful this will be reflected in your return.

Be Fearless, but not reckless – Your money should work hard for you, but it won’t without you taking a leap of faith & investing. It’s ok to be worried or anxious but if you have followed our tips you should have all the information you need to make an informed decision.

Consider reinvestment and rolling over your interest – Interest earnt from passive investing is considered an income, & is therefore liable to be taxed as such. If at the end of the term, you don’t need the funds back immediately, consider reinvesting or extending the terms & adding the interest to the pot. You can then take the interest profit when it is most tax efficient for you to do so.

If you would like to learn about investing with us, get in touch we would be happy to start the conversation with you & see if we both feel comfortable with an investment agreement (01273 525656 or information@targetfive.co.uk).

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Projects Completed

BEFORE & AFTER – BAYFORD ROAD, LITTLEHAMPTON

A couple of weeks ago we shared our completed renovation; Bayford Road, Littlehampton. Here’s how we got there!⠀ ⠀

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The period terraced property was originally 5 bed, spread over 3 floors, which needed to be totally gutted. In doing so we were lucky enough to uncover exposed brickwork to all chimney breasts and brickwork to the hallway, incorporating this into the design theme for feature walls.

We have created an 8 bed HMO with 7 bathrooms, designed for professional sharers. ⠀

If you have any questions about this property, let us know! If you’re interested in finding out more about T5 and how we can work together, please email information@targetfive.co.uk

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Projects Completed

GEORGE STREET, HOVE

We have done it, finally! our George Street project is over the line. Following numerous challenges and design changes, which caused a few delays.

Originally our plan was to convert this mixed use property, which was once a former banking hall, with x2 commercial units and residential above, to x2 commercial units with 4 studio apartments above. This changed midway through to creating x2 twodio apartments and x2 1 bed apartments.

We chose a monochrome interior design theme, which again was adapted to incorporate a splash of yellow to liven the rooms up. We have also used black brick slips, which have a strip light that doubles up as a bedside reading light as well as highlighting the feature wall and wallpaper.

With a special thanks to @brightonrenovationsltd for their hard work, patience and resilience.

The property is now available to let to professional sharers via our partners @proletsuk.

Fingers crossed for the property valuation, which we should have good news on soon!

What do you think, do you have a favourite feature?

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Projects Completed

BAYFORD ROAD, LITTLEHAMPTON

We started our Bayford Road project in February, which has been completed in the past couple of weeks, after a few little delays.

The period terraced property was originally 5 bed, spread over 3 floors, which needed to be totally gutted.  In doing so we were lucky enough to uncover exposed brickwork to all chimney breasts and brickwork to the hallway, incorporating this into the design theme for feature walls.

We have created an 8 bed HMO with 7 bathrooms, designed for professional sharers. With thanks to @brightonrenovationsltd for all of their hard work in creating our favourite project so far!

Our friends @nichecom_uk have sent over the professional pics, which look fab!  The property is now on the rental market with our partner company @proletsuk, with 3 rooms snapped up on the first day of viewings!

What do you think?