Description

Bologna Rent2Rent is a RE-Build project aimed at financing the company Nova RE S.r.l. (a company with an equity turnover of 1.3 million euro) for the construction of a "Rent to Rent" portfolio comprising 50 flats located in Bologna with an estimated annual turnover of 1.8 million euro.

The portfolio will be built in several phases as follows

• 25 flats in Q4 2023
• 10 flats in Q1 2024
  
• 10 flats in Q2 2024
  
• 5 flats in Q3 2024
  

for a total of 50 flats that will generate annual revenues of EUR 1.8 million with a gross margin of 57.3%.

The company will take care of the standardisation of the flats through home staging operations aimed at guaranteeing the improvement of energy efficiency and living comfort for the subsequent rental of the flats with the short rent formula.

The 'Rent to Rent' business model envisages that the rented flats are subsequently leased to third parties for short periods, generating estimated quarterly income of around 450,000 euro.

The flats that will be part of the portfolio have the following main characteristics:

1. Strategic location: flats located in strategic areas of the city of Bologna, (historical centre and tourist attractions, university areas and areas adjacent to hospitals).
2. Enhancement potential: flats that comply with modern living standards, but with a high potential for improvement with a low marginal cost, which together with the change of rental method - from long to short term - will generate an increase in monthly income of approximately 250%.
   
3. Potential of short rent: according to tourism data shared by the Municipality of Bologna, the city recorded more than 3 million overnight stays in 2022 and a hotel occupancy rate that increased from 69.3% in 2019 to 75.9% in 2022.
   

Moreover, as Bologna is a predominantly university city, any slowdown in the tourism sector will not have a significant impact on the company's business model, as it will be able to use the flats for student rentals.

Promoter Information

Nova RE S.r.l. is a newly established company and already has a solid capitalisation of approximately 1.3 million euro; it is part of the Marella entrepreneurial group, led by Francesco Marella, a graduate in construction engineering and representing the third generation in the real estate and construction industry. During his career, he has also held the following roles: CEO and chairman in the board of directors of Nova RE S.p.A. a real estate company listed on the Milan Stock Exchange. Deputy Chairman of Meridie S.p.A, an investment company listed on the Milan Stock Exchange. Board member of Ream SGR. Managing Director of the family company active in the construction of public infrastructure (motorways and railways).

In particular in real estate development among the group's most important projects:

• Construction of residential and office complexes in Potenza for a development of about 13,000 sqm (revenues of about Euro 25 Mln);
• Renovation and sale of residential and office complexes in Ferrara 11,000 sqm;
  
• Construction and sale of tourist complexes in Val di Fassa for 7,000 sqm.
  

The Marella group also controls the company Immobiliare Madrò S.r.l., which has been operating in the Emilia area for years and has already financed and repaid 7 projects in Bologna through our platform:

Loan Information

Bologna Rent2Rent is a RE-Build project aimed at financing the company Nova RE S.r.l. for the construction of a "Rent to Rent" portfolio comprising 50 flats located in Bologna with an estimated annual turnover of 1.8 million euro.

Total amount: € 500,000

Amortisation period: 18 months

Annual interest rate: 10%

Interest payment: monthly

Capital repayment: on maturity (bullet)

Financing objective: RE-Build

Duration of collection: 30 days

Collection opening date: 05/10/2023

Closing date of funding: 05/11/2023

Rating from independent third-party company: BB (calculated on sector and capitalisation of the company as a start-up company)

RE-Lender Score: Not calculable as a newly established company

Project rating: B

Additional guarantees: personal surety of shareholders

Applicant company: Nova RE S.r.l.