Case study

We understand that every investor has individual preferences and requirements. That’s why LINUS offers tailored solutions to its co-investors. To give you an idea how a collaboration with LINUS will look like, we provide you a case study below, that illustrates the experience of a family office that invested with us for the first time.

On-boarding

The family office is looking for real estate investment opportunities with a medium term horizon of less than three years but with attractive yields. Their goal is to find an investment partner, and not just an intermediary. The family office hears about LINUS and registers for our online platform. After their registration request the family office receives a call from one of our investment managers, who outlines our investment focus. LINUS invests in real estate mezzanine debt, and typically engages in deals that require EUR 3 M – 20 M mezzanine capital. We focus on residential and business developments, as well as hotels and serviced apartments in A- and B-cities in the DACH-region and the Greater London area. Our investment durations range from 24 to 36 months. Our unique, digital investment approach allows us to provide exclusive off-market deals to our co-investors, that would be inaccessible to them otherwise. Through our back funding model, we are able to secure deals early on, even if no co-investor has expressed interest in a specific deal yet. During the initial conversation we also inquire about the individual investment preferences and requirements of the family office, like the amount they want to invest, minimum yield or optimal duration. Additionally a personal meeting in the office of LINUS in Berlin takes place. Convinced of the benefits of the LINUS platform, the family office requests an account. After some regulatory checks LINUS sets up a co-investor account for the family office, and their team can now access current and past projects on the LINUS platform. The family office is now part of the exclusive circle of LINUS co-investors, and can review and invest in our off-market projects.

text
Example of the project overview of a co-investor

Investing

Upon request the family office receives push notifications and updates on potential investment opportunities that are aligned with their individual investment strategy. A value add project in Berlin catches their interest. It is an office building on a 8,000 sqm property that needs to be renovated. The project’s total investment costs are EUR 27 M, and the duration of the EUR 4 M mezzanine investment is 24 months. The mezzanine investment offers 10 % p.a. interest rate, that is paid as bullet at maturity. The family office can review further project details on the online platform such as tenancy schedules, contracts, break even analysis and more detailed information about the real estate developer. After an initial review the family office starts the investment process online and requests an allocation. LINUS responds swiftly and contacts the family office directly. Our investment manager discusses the project details and risks with the family office in a phone call. LINUS provides all necessary documents and the due diligence. The family office decides to invest EUR 500,000. LINUS still holds EUR 1.5 M of the investment on its own books.

Lean execution

The execution of the investment is simple and easy for the family office, taylored for their individual needs. They can complete the investment process remotely at their own office. LINUS provides standardized contracts that reduce administrative and legal fees, and speed up the investment process. The family office becomes a limited partner in a special purpose entity that is structured as a limited partnership under German law. The limited partnership holds the loan and passes through all payments to the limited partners. The signing is done at the family office’s local notary, and after the signing LINUS continually monitors and manages the investment.

Digital reporting

All project details are available online on the LINUS platform. The family office can also opt in to receive push notifications for project specific quarterly reports and updates on the project. The reports include the project timeline, information on the projects budget and cost structure, as well as current lease information. The investor also receives current information about the project such as progress updates and pictures. Our investment team is always available to answer questions.

text
personal investment portfolio of a co-investor

End of project and repayment

After two years, the project is completed. The family office and LINUS simultaneously receive their respective principal and bullet interest payments. LINUS provides a comprehensive final reporting. The family office still is a proud partner of LINUS and has invested EUR 2.75 M in various projects until now.