Apartment Rental Crowdfunded Argentine Real Estate

[MisSnow]

Has anyone by chance looked into crowdfunded Argentine real estate via Crowdium? It's like Fundrise for the US. If you did, please share what you learned. I just found out about them today.

 

[earlyretirement]

The most important part of that website is the one where it says that they don't guarantee to get anywhere near their estimates of ROI. No way these days they can produce that type of ROI that they are predicting. Also, most projects in Argentina take MUCH longer than they say it will take and it costs much more than they estimate due to the crazy inflation.

Plus, in the event that the builder goes belly up and bankrupt you really have no recourse at all. Unfortunately the judicial system doesn't work in Argentina so you're pretty much screwed on these types of projects.

I once bought into a new project development and obviously they were over 1.5 years late. At the end, the developer basically told all the owners in the building that we all had to pay 25% more vs. the price we agreed upon. Everyone was furious but they said the other option is they will just declare bankruptcy and we could take them to court. And that's a multi-YEAR process. It was cheaper and quicker to just pay more.

I've also had court cases where I had a clear cut case. Took 3 years to get in front of a judge and then once it did.... surprise surprise the judge was bought off or there was clearcut fraud saying a date of the trial was changed and we never showed up so we lost. The summons notice that the date was changed we NEVER signed and it was forged. Typical day in the life in the Argentine judicial system.

 

[FlowRose]

Has anyone by chance looked into crowdfunded Argentine real estate via Crowdium? It's like Fundrise for the US. If you did, please share what you learned. I just found out about them today.

They are well known but i haven't try them.

 

[MisSnow]

It looks like they offer good returns. I'm not sure though if the returns they are calculating take inflation into consideration.

 

[earlyretirement]

It looks like they offer good returns. I'm not sure though if the returns they are calculating take inflation into consideration.

Well do NOT trust what they SAY they produce. Let me give you another example. So back many years ago there was a developer that built a high-rise in Palermo Hollywood called Palermo Hollywood I and II. The developer had this great idea to basically turn the units into an investment where they would manage the property, take care of tenants and take care of all your taxes.

I had a friend that bought into that project. The building turned out well but when they went to get their rental proceeds, the management company would never pay it. Then when they went to go sell their property, it turns out this management company NEVER paid any of their taxes (property taxes or rental taxes). They too claimed of amazing returns. And in the end, they basically just said, "sue us" because they knew that it would take YEARS to get in front of a judge.

The truth of the matter is that if it sounds too good to be true then it typically is anywhere in the world but especially Argentina where nothing works, it's plagued with corruption and inflation is out of control.

 

[FlowRose]

Certainly, let's delve into the details. To assess the credibility of the venture, it's essential to scrutinize the company. In this case, the company is associated with the Newling Capital group, owned by Manuel Estruga and Damian Lopo. The CEO, Mariano Nejamkis, is a notable figure, recognized as the former founder and CEO of ZonaProp.com. While these credentials offer some insights, it's imperative to conduct a thorough examination.

Regarding the project itself, it appears to hold a solid foundation. An acquaintance working in Vaca Muerta attests to the substantial salaries in the area, ranging from 50,000 to 60,000 pesos per month for entry-level positions. With a predominantly single male workforce with disposable income, sectors like rentals, restaurants, and certain commodities witness significant demand.

Examining the rental prices aligns with the projected growth outlined in the investment. However, potential investors should be cautious about the stated Return on Investment (ROI) of 25-35% over two years. The calculation seems to overlook expenses and commissions ranging from 7% to 10% of the initial investment. Considering these costs, the actual ROI is more realistically estimated between 14%-23%, translating to an annual return of 7%-11.5% to 8.5%-13%.

Patagonia, while lucrative for certain investments, does pose challenges. The scarcity of labor requires higher wages, impacting construction costs. Additionally, securing a dedicated workforce can be challenging due to high demand.

It's crucial to conduct individual research and closely examine the numbers and finer details. The crowdfunding landscape in Argentina is evolving, and while new laws are being introduced, it remains essential to thoroughly vet each project. While there have been successful crowdfunding projects, the reliability often hinges on the contractor's reputation.

In conclusion, conducting a comprehensive analysis and staying informed about the evolving crowdfunding regulations will contribute to informed investment decisions.

 

[earlyretirement]

Certainly, let's delve into the details. To assess the credibility of the venture, it's essential to scrutinize the company. In this case, the company is associated with the Newling Capital group, owned by Manuel Estruga and Damian Lopo. The CEO, Mariano Nejamkis, is a notable figure, recognized as the former founder and CEO of ZonaProp.com. While these credentials offer some insights, it's imperative to conduct a thorough examination.

Regarding the project itself, it appears to hold a solid foundation. An acquaintance working in Vaca Muerta attests to the substantial salaries in the area, ranging from 50,000 to 60,000 pesos per month for entry-level positions. With a predominantly single male workforce with disposable income, sectors like rentals, restaurants, and certain commodities witness significant demand.

Examining the rental prices aligns with the projected growth outlined in the investment. However, potential investors should be cautious about the stated Return on Investment (ROI) of 25-35% over two years. The calculation seems to overlook expenses and commissions ranging from 7% to 10% of the initial investment. Considering these costs, the actual ROI is more realistically estimated between 14%-23%, translating to an annual return of 7%-11.5% to 8.5%-13%.

Patagonia, while lucrative for certain investments, does pose challenges. The scarcity of labor requires higher wages, impacting construction costs. Additionally, securing a dedicated workforce can be challenging due to high demand.

It's crucial to conduct individual research and closely examine the numbers and finer details. The crowdfunding landscape in Argentina is evolving, and while new laws are being introduced, it remains essential to thoroughly vet each project. While there have been successful crowdfunding projects, the reliability often hinges on the contractor's reputation.

In conclusion, conducting a comprehensive analysis and staying informed about the evolving crowdfunding regulations will contribute to informed investment decisions.

Definitely it IS possible to make money with real estate but my point was all of the unknowns, possible delays, legal issues, etc. But no doubt you can make good returns if you are patient. I remember back in 2003, I bought several units in a high rise in Palermo when it was still a hole in the ground. The project finished about 2 years later than they said it would but you could pick up studio apartments for about $50,000 and by the time it finished, I sold a few units for $120,000 @.

Out of all the things to invest in Argentina, I still think over the long term, real estate is one of the safer investments in the country. Previously, no one trusted the banks but this is changing.