Shojin Celebrate Milestones & 1 year in Property Crowdfunding

Discussion in 'General Property Investment Discussion' started by Gareth Bain, Sep 27, 2018.

  1. Gareth Bain

    Gareth Bain Member Forum Partner

    Despite the current economic challenges, the cooling property market and the threat of Brexit, Shojin Property Partners continues to go from strength to strength. Shojin Property Partners celebrates its one-year anniversary since launching its online FCA regulated Property Investment Crowdfunding platform on 27th September 2017.


    In the last year, Shojin’s crowdfunding platform has raised over £3m across 5 projects throughout the UK. Jatin Ondhia, CEO of Shojin said “Our intention was always to bring quality, institutional grade property investment projects to a broader market. We are the only platform to operate across the property investment spectrum and our clients have always appreciated the variety we provide as well as the depth of due diligence we carry out.”

    Since launching online, the company has crowdfunded £1.5m in equity for the development of 18 flats in North London, as well as £381,000 in equity for the development of 49 apartments in Southend with a targeted return of 26% annualised. The further £1.1m has been spread across mezzanine loans and bridge loans.

    These comprised of a £230,000 fixed term investment project in London with a 15% annualised return, a refurbishment project in Hampshire which for £190,000 which was fully funded in 5 days and aims to give investors an 8% annualised return as well as a student accommodation development in Nottingham worth £701,000 and an expected return of 15% annualised return.

    Shojin are currently offering investors the opportunity to invest in a newly-built, fully let student accommodation development in Nottingham.

    In a low interest rate environment, investors have naturally been attracted by the high returns Shojin targets. However, more importantly, the online platform enables investors to put their money directly into projects of their choosing and keeping more of the returns compared to traditional investment funds. Furthermore, earlier this year Shojin became an ISA manager which enables investors to take advantage of their annual £20,000 tax-free investment allowance.

    Ondhia said, “Coming from an Investment Banking background, I wanted to create products that suit the needs of individual investors, rather than shoe-horning investors into a standardised product.


    To that end, we launched a series of mini-bonds designed to provide investors with monthly or annual fixed returns over varying time-frames. These make it simpler for investors to put their money to work without having to choose individual projects to invest in.”


    Since September 2017, Shojin has seen its database continually grow with 55% of its investors coming from the UK and 45% coming from overseas markets. With the cooling of the UK property market and the weakening currency, the UK property market has become an attractive country for overseas investors.


    Ondhia said, “We offer investors from around the world the opportunity to invest into the UK property market from as little as £5,000. With the growing middle classes across the world, this enables them to invest internationally in the same way that the wealthy have been doing for a long time”.


    With property prices rising and the younger generation struggling to get on the property ladder, a large proportion of millennials have turned to crowdfunding to invest in property with around 23% of the investor network being under the age of 32 years old and the youngest investor being just 18 years old. The largest investor contingent was those younger than 47 years old and counted for around 40% of the investor database with an average investment value of £38,000. “In a relatively short period of time, we have managed to gain the trust of investors resulting in 18% of our database reinvesting in two or more investment opportunities”.


    “I think what sets us apart from our competition is that we align our interests with those of our investors – we co-invest in every deal without charging any hefty upfront fees or management fees. We make money by sharing profits at the end. If our investors don’t make money, then we don’t make money.”


    The future looks bright for Shojin with the imminent launch of its secondary market, allowing property investors the ability to buy, sell and trade their investments at any point. This gives investors liquidity with their investments and the ability to buy in an out at any stage.

    “Our goal is to disrupt the property investment market and make property investment accessible to all. We want to help more and more people invest in property without having to have large sums of money.” If you would like to find out more information about the future of Shojin Property Partners visit www.shojin.co.uk
     
  2. Longterminvestor

    Longterminvestor Administrator

    During the last year it has probably been one of the more challenging times for the UK property market so the funding figures look even better against this. I would be very interested to learn about your thoughts on Brexit and whether you have any view on the Bank of England's recent worst case scenario forecast.
     
  3. Gareth Bain

    Gareth Bain Member Forum Partner

    The current uncertainty will scare many people off, and that creates opportunities. Funding is currently available for investment purposes and it's worth investing in high yielding property with good growth potential. Naturally, I would also add that it's better to do this through a Crowdfunded model which enables you to spread your investment over several properties, provides some element of liquidity in case you ever need to take some money out and takes away all the hassles of sourcing, due diligence as well as mitigating risk.


    Depending on what happens with Brexit, there may be a short-term impact on availability of finance (as happened when we had the Brexit vote) but I believe that will be short-lived. The UK property market has strong demand both from its' rising population, as well as global investors who see it has a safe haven and a very secure market with strong property rights. That is not going to go away just because of Brexit. If you have the ability to invest for the long term, you will still do well.


    At our recent investor event, we address Brexit and spoke about the opportunities in the market post Brexit. I have included the blog post to these opportunities for reference. https://www.shojin.co.uk/blogs/where-are-the-current-investment-opportunities


    Regarding the Bank of England forecast, I think that it is a case of ‘prepare for the worse and hope for the best’. There is a lot of Doomsday talk making the rounds at the moment which is what is causing this uncertainty which creates opportunity.
     
  4. Longterminvestor

    Longterminvestor Administrator

    Personally I think the key here is to see beyond the short term mist and focus on the longer term. There are some fantastic rental yields available out there - even more attractive when compared to interest rates. The UK is the 5th/6th largest economy in the world and the idea it will "disappear" overnight after Brexit is central to project fear. The sky wont fall in, the property market wont collapse, it will take time to adapt to the new environment but the UK has done this time and time again in the past.
     
  5. Gareth Bain

    Gareth Bain Member Forum Partner

    I agree 100% with the above. I think that we must not get fixated on the 'Brexit Doomsday' but rather look at this as a long-term opportunity. The market is cooling and with Buy to Let landlords offloading their properties at an alarming rate, there are opportunities out there.

    As mentioned above, the UK economy is strong and it has a lot to offer the rest of the world in terms international students coming to study, the skills gaps and opportunities in the job market as well as a domestic market that needs houses.

    As a business, we see a lot of opportunity in the student accommodation market. https://www.shojin.co.uk/blogs/why-is-now-the-time-to-invest-in-student-accommodation

    With change comes opportunity and the UK would not be within the top economies of the world if they didn't innovate, pivot and adapt to change.
     
  6. diyhelp

    diyhelp Active Member

    The more volatile markets are the more chance of finding a good deal - I think we might see one last swish of the Brexit tail as those panicking about property prices decide to bail out. That may well be the time to buy :)
     
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