Sharing out the benefi t INVESTMENTS
52 | SHARED Ownership WORDS | Amit Katwala
www.opp.org.uk | FEBRUARY 2011
A luxury multi-million euro apartment in the wealthy 8th arrondissement of Paris is out of reach of the majority of second-home buyers. But, one such property, a mere stone’s throw from the Champs Élysées, is available at a much lower price point than usual, thanks to the growing concept of “shared ownership.” What does the Rocksure Capital Fund really offer overseas property investors?
antique furniture and a concierge service, this Parisian property is the fi rst of 10 that will be made available in cities across Europe as part of Rocksure’s Capital Fund. Shared ownership combines the fl exibility and multiple destinations offered by timeshare with the peace of mind and fi nancial benefi ts of actually owning something tangible. Unlike timeshare, investors in a shared ownership fund have shares in a holding company, and they receive the profi t when their shares are sold.
D For Rocksure, it works like this. A
ecorated by renowned South African designer Josie Hemingway, and featuring
full unit in the fund costs €115,000, and entitles the owner to 14 nights per annum in any of the 10 properties that will be purchased in Paris, Cannes, Venice, Florence, Rome, London, Barcelona, Marbella, Prague and Vienna. Investors can double their entitlement by choosing to stay at off-peak times only. In addition to the cost of purchasing the unit, there is an annual service charge of €2,100 and a visit charge of €200 per booking. When all of the 170 available units have been sold, the fund will be closed to new investments. Ten years after this, all the properties in the fund will be sold, and any capital gains made will be redistributed back to the investors.
This isn’t a new idea – Rocksure launched its fi rst fund back in 2006, but few companies have entered the market. However, David Rogers, one of Rocksure’s founding directors, believes it is only a matter of time before shared ownership funds replace second homes as the most popular vehicle for overseas property investment.
“Anyone who has ever bought a second home over the last fi fty years knows they were doing a silly thing,” he said. “They knew that would be committing themselves to that property for years, and it’s a waste of capital and time. You have to fi nd it, look at it, buy it and renovate it and if you want to get a return out of it you have
the hassle of sub-letting and the whole customer service nightmare. If you roll the clock forward, in 20 years it will be completely different. For my kids and their kids, when they make a pile of money, it won’t even cross their minds to buy a whole house in another country – it’s completely mad.”
The Hideaways Club, launched after Rocksure, offers a similar product but with liquid funds that have no set closing date. CEO Nick Bettany is in agreement with Rogers about the bright future of shared ownership. He said: “What we offer is a great alternative to second home ownership and we see this kind of investment as going to go from strength to strength.” And there
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