Frequently Asked Questions

A Fund invests into right to purchase (RTP) contracts. This is a contract that provides the right to purchase a completed property, built to a specified standard, in a specified timescale at a specified price. The contract is tradable and the Fund looks to purchase at the first stage of construction and sell it at a profit as the building process is completed. A Fund will only place a deposit of typically between 30-50% of the agreed purchase price and does not borrow to do this. Therefore, a small increase in the value of the property is exaggerated by the fact that a Fund has only placed a smaller deposit.

A Fund is provided with a bank guarantee for every right to purchase contract that is bought. The developer, at their own cost provides the Fund with a bank guarantee in relation to each RTP contract and this protects the Fund in the event of the insolvency of the developer.

When a Fund purchases a RTP contract 15% of the deposit monies are retained by the Property Manager so that if contracts have not been resold within the agreed timescale (normally 2 years) then this is returned to the Fund as an enhancement. This is a return before accounting for the Annual Management Charge (AMC) and any other costs. The 15% is also returned to the Fund in the event of the developer ceasing business and is in addition to the bank guarantee.

Each Fund has a 0% initial charge and a 1.5% AMC which is deducted quarterly in arrears. There are also costs which are detailed in the Supplementary Memorandum specific to each Fund.

Each Fund is fully listed on the Channel Islands Stock Exchange (CISX), which is advantageous to certain investors.

Each Fund invests in Euros and accordingly for Sterling investors any exchange rate movement over the duration of the Fund could be either positive or negative as this risk is not hedged. If at maturity a client does not wish the proceeds to be converted back to Sterling then the proceeds can be settled in any currency.

The Fund receives 15% enhancement on each contract and still benefits from any profit when these contracts are subsequently sold.

The proceeds will be returned once all the underlying RTP contracts have been sold. A redemption date is stated which is normally 2 years as this is the anticipated term, however if all RTP contracts are sold beforehand then a Fund will settle earlier. Likewise, if there are RTP contracts remaining at the agreed redemption date then all proceeds will not be returned until they have all been sold. A Fund has the ability to make a partial redemption and this will be evaluated based on the circumstances prevailing in relation to each Fund.

No, this is the role of the Property Manager in conjunction with the Developer and they also bear the costs associated with this.

As a closed ended investment Fund there is no daily published price as the assets are only valued annually at the 30th June. The audited accounts are prepared at the same date by BDO and will be issued within six months of this date. Interim accounts are prepared as at 31st December, but with no revised valuations.

The latest performance information is contained in a CISX announcement (http://www.cisx.com/listedsecuritynewsdisplay.php?newsID=34226) which shows a 48% uplift on completed property sales to date in Cell No.4 Cape Verde.

The Fund administrators, Heritage International Fund Managers (HIFM) issue contract notes once any trade has taken place. The trading dates are all specified in the Supplementary Memorandum. The only exception to this is in respect of ISA or Offshore Bond investments which are purchased via Nominees. You should receive confirmation from the wrapper provider as HIFM only issue one contract note to the Nominee as they are not provided with details of the underlying investors.

Commission is usually settled 2 weeks after the trading date via BACS and accordingly is normally in the designated bank account some 3-4 working days later. The commission level is 10% of the invested sum

No. As the commission is not taken from the client’s investment i.e. 100% allocation, there is no mechanism for enhancing the terms.

All the major SIPP providers support our Fund. The only insured based SIPP contract that we are aware is not allowing access to our Fund is Norwich Union. In addition the Fund cannot be held within the Scottish Widows Retirement Account Plan or the Transact pension vehicle as both are personal pension structures rather than SIPP.

Yes, both Suffolk Life and Brooklands will allow Protected Rights monies to be "self invested" in to our Fund.

For ISA a Fund needs the wrapper to have a "self select" option and the most popular platforms are Transact, Williams De Broe, W H Ireland and Funds Direct (Intrinsic), however any stock broker should be able to purchase a Fund for your clients.

For Offshore Bonds a Fund can be purchased via Canada Life International using their Premiere product. Clerical Medical International have also confirmed to Canada Life International that they will purchase units in the Fund via the Delta Account. We are currently in discussions with various other providers and will issue further updates in due course.

Auditing; BDO Novus
Tax advice; KPMG
Administration; Heritage International Fund Managers
FSA Advice; Wragge and Co
Advocates in Guernsey; Ozannes
Banking; RBSI