Transaction / Assets Seller Buyer € MM
Domo Gestora’s Socimi Acquires Its First Plot Of Land
24 March 2017 – Inmodiario
Domo Activos Socimi, the Socimi promoted by the real estate manager Domo, has acquired its first asset. The asset in question is a plot of land, located in Ensanche de Vallecas, in Madrid, where the company plans to develop a residential building comprising 80 homes for rent with the option to buy. This Socimi’s business model focuses on buying land on which to construct buildings for their subsequent rental. Once the mandatory three years during which they must lease the properties out has passed, the Socimi will then proceed to sell them, whereby benefitting from the tax benefits enjoyed by these types of companies. In this way, all of the profits generated from the date the land is acquired until the date the properties are sold is taxed at 0% for Corporation Tax purposes.
According to the company’s estimates, the returns on this project, once the divestment has been made, could reach 10% per annum. Before the sale and whilst the properties are being leased, investors will receive profits resulting from the rental income, in the form of dividend payments.
Domo Activos Socimi will debut on the Alternative Investment Market (MAB) in the recently created sub-segment, called “Socimi under development”. Socimis that allocate less than 70% of their assets for rent trade there. In this case, Domo Activos Socimi will ask to be incorporated into this sub-segment, given that initially, it will own just one plot of land.
Domo Activos Socimi’s business model allows its shareholders to participate in the advantages and returns offered by traditional Socimis, as well as in the returns offered by the development and construction of properties.
Domo Activos Socimi plans to file its request to join the MAB during the first half of 2017. This milestone will allow Domo to fulfil one of the main objectives that it set itself when it launched this Socimi, namely, to enable small and medium-sized investors to access investments with these characteristics.
Domo Activos Socimi has successfully completed its first capital increase, which has allowed it to acquire this plot of land and for the time being and until it debuts on the MAB, with the traditional “Ringing of the bell”, it may increase its share capital again, which would likely require a minimum necessary investment per shareholder of €100,000.
Original story: Inmodiario
Translation: Carmel Drake