Risk vs Opportunity

Our investment opportunties in property development projects are available to only certain types of investor, as detailed on our eligibility page. We are sorry, we cannot help anybody who does not fall into the categories as detailed. However, it is possible to buy property or to sell land using CrowditBuildit services, and this website.

No investment can ever claim to be risk free. Investment in property is no exception. There are always 'opportunities vs risks' considerations. That is why CrowditBuildit have put into place a number of key systems and structures:

• All monies are held in an escrow account, which is managed by a Security Trustee. The terms of the escrow are made explicit. This means that nobody has access to the monies without meeting the terms of escrow. A reputable and well known accountancy firm are appointed Security Trustee. They are experienced at running an escrow. They are secured with professional indemnity insurance.
• The independent Security Trustee is independent of CrowditBuildit Ltd, and all its suppliers and associates.
• The Security Trustee acts on behalf of the investors. The Security Trustee will ensure that all decisions are made in the interests of the investors.
• The Security Trustee will make decisions as to when there is sufficient fund available to commence building work; the Security Trustee will make decisions about how much fund to release each month to suppliers. They do this to ensure a project runs smoothly from a financial and cashflow point of view.
• The Security Trustee is normally advised by an independent Quantity Surveyer, who will assess the progress made by the building contractor. Only when both the Quantity Surveyor and the Security Trustee is satisfied that a given stage of the building work is complete, applying the correct quality controls, will the funds be released for payment to the contractor.
• The terms of the escrow state that the monies can only be used for building once the crowdfund has reached target. It will clearly state on each property whether there is sufficient in the fund to start the build.
• If the crowdfund does not reach target, in normal circumstances, the pledges will not be drawn down into the escrow.
• Once a crowdfund reaches target, the investors are then given a sharheolding in the land and build asset, via a debenture. This is in essence a 'mini-bond'. This means that, in the case of problems, the investment is secured on the value of the assets of the company undertaking the building, i.e. land, building work undertaken, assets such as planning permission etc.   This is termed the 'equity' of a given project, which comprises of key assets. The debenture terms mean that the investor will be able to use these as a basis for recuperating the original investment, if things go wrong. The Security Trustee will oversee all related activities.
• CrowditBuildit provide complete transparency to its members (the 'Crowd of investors of a given project'), with access to accounts, project planning information, and direct access to accountants, project manager, and lawyers. They hold on-site visits for members on a regular basis, and investors will be able to see all projects develop, and their predicted performance.
• Investors are invited to make site visits, meet the builders, and will be able to access building planning documents.
• Our approach to crowdfunding property development has been to Queens Counsel for legal approval.

It should be noted that despite these precautions and transparency that CrowditBuildit apply to the process, an investment cannot be considered to be risk-free. That is why we have developed our own Risk Statement, which you can read below. This should be considered as you explore the opportunities vs risks.  

Risk Statement

Investors should be aware that there are always risks when making any form of [financial] investment. Investing in CrowditBuildit properties and projects are no exception to this. Investments in property may appear to be one of the safest forms of investment, but they are not an exception to the general rule, that there are always risks when investing.

The Investor should note that in relation to investments and investment returns past / historical performance is not a guide to or guarantee of future performance. Furthermore, as the value of property can go down as well as up. CrowditBuildit Ltd, nor any of its subsidiaries, cannot provide a guarantee that your initial capital will be returned to you in part or in full or that any interest will be paid.

This notice cannot disclose all the risks and other significant aspects of transacting in financial instruments and/or the capital markets worldwide. You should not deal in financial instruments unless you understand their nature and the extent of your exposure to risk. You should also be satisfied that the specific financial instrument(s) that you select is / are suitable for you in the light of your circumstances and financial position. Some / many financial instruments are unsuitable for many investors, with different financial instruments involving different levels of exposure to risk. In deciding whether to trade in such instruments you should be aware of some if not all the items listed hereafter.

The potential gains and losses that may arise from your investments may depend on your appetite for risk and how you manage your approach to risk. Placing all your money into one type of investment can be a high risk strategy. The value of your investment could increase significantly, but it could drop significantly too. There is always a risk that you may lose the entire sum invested. A managed approach to risk may be to diversify your investments across different projects or companies’ debentures / shares and different asset classes.

The investment opportunities offered by CrowditBuildit Ltd and its subsidiaries may not be suitable for you. If you have any doubts as to the merits of an Investment, you should seek advice from a fully authorised and regulated independent financial adviser. Please note that CrowditBuildit Ltd will never provide any financial or investment advice to a prospective investor. CrowditBuildit Ltd strongly suggest that in all instances appropriate financial and/or investment advice should be taken either from your own professional adviser, who are appropriately authorised to provide such advice. In all cases and at all times, it is your responsibility to ensure that any advice you take is from a suitably qualified, regulated and authorised party. By not taking professional advice on any investment prior to entering into any investment contract, you do so entirely at your own risk and are potentially jeopardising your entire investment.

Neither CrowditBuildit Ltd nor any of its subsidiaries are members of the Financial Services Compensation scheme (FSCS). In the event of any failure of CrowditBuildit Ltd or any of its subsidiaries, you will not be protected under the terms of this scheme.

CrowditBuildit Limited and its subsidiaries are be located within the United Kingdom, and in the majority of cases within England itself. You will be duly notified of any investment(s) that are located in any other location. Investments offered by CrowditBuildit Ltd are primarily for United Kingdom based resident investors. Any investments from outside the United Kingdom carry their own risks. The investor(s) need to be aware of and compliant with the regulatory, investment and taxation regimes applicable to the relevant jurisdiction in which they officially reside.

You, the counterparty, agree that neither CrowditBuildit Ltd nor any of it subsidiaries and/or officers can be held liable or responsible in perpetuity, for any investment made directly by you or on behalf of any investor(s) that is neither United Kingdom compliant or compliant with the rules and regulations of the jurisdiction from which the investment is being made.

Due to the risk associated with any investment, CrowditBuildit Ltd and its subsidiaries reserve the right to accept, decline and/or terminate any investment without prior notice or explanation and entirely at their own discretion.

CrowditBuildit Ltd and its subsidiaries will provide to the investing party(ies) a registered and secured debenture in recognition of and upon execution of an investment in a project. It should be noted that a debenture is a document which neither creates a debt or acknowledges it. A debenture issued by a company is in the form of a certificate issued under the Company’s Common Seal. In other words it is a ‘promise to pay’, occasionally referred to as a ‘promissory note’. The date of repayment is specified in the debenture as is the amount to be paid. Unless otherwise stated, the capital and interest are repaid at a pre-arranged point in the future, in given conditions, although this cannot be guaranteed. It should be noted that unlike shares in a company, debenture holders have no right to vote at the company meetings (including annual and general) and cannot therefore influence the direction of the company.

Registered debentures are paid to the registered holder whose name appears both on the debenture and in the Register of Debenture Holders maintained by the CrowditBuildit Ltd or one of its subsidiaries. Although registered debentures are transferable, if so done, it is a requirement that they are re-registered. Registered Debentures are not negotiable instruments. A registered debenture contains a commitment to pay the agreed interest and to repay the principal at a given point in the future, although this cannot be guaranteed and / or may vary. It also contains a description of the charge and a statement that it is issued subject to the conditions endorsed therein.

Secured debentures are intended (but do not guarantee) to create an additional level of security by creating a charge over the assets of the project company. It should be noted that a secured debenture does not / will not guarantee a full return of capital and interest, for instance in the event of the Company going into administration. It does however, insure that the investor has a noted interest in the Company assets in the event the Company goes into administration.

CrowditBuildit Ltd and its subsidiaries ensure that no investor funds are held by themselves, but by a third party firm of Chartered Accountants in a segregated escrow account, no guarantee can be given that the funds are held in escrow without risk.

Whenever possible CrowditBuildit Ltd and its subsidiaries will sell the properties in which the investment is being made from plan. Any such sale cannot and is not guaranteed. In circumstances where this is possible the buyer will contract with the company and pay a retaining deposit at the point at which the target funding has been reached and the land can be purchased and construction can commence. Sale from plans is an attempt to reduce risk of a non-sale at a later stage although it carries no guarantee. In the event that the property is not sold from plan, it will be marketed for sale at the earliest possible juncture.

Please note that we are not able to provide investment opportunities to retail investors.