The fund is conceived for qualified investors, both institutional and private, who would like to profit from lucrative properties without investing in them directly. Similar to real estate funding, diversified investing in various objects or projects, for example, reduces risk. Differing from real estate funding, the Bargella mezzanine fund applies one specific circumstance that is expected to persist quite a while: The growing demands on equity sums and/or lower loan-to-value-ratios of banks based on Basel II / III and Swiss FINMA regulations.
Qualified investors with a minimum investment of 500,000— Swiss francs.
Qualified investors are essentially
a) monitored financial intermediaries such as banks, insurance companies, funding institutes, pensions funds, etc.
b) other investors who have closed an administrative contract with a financial intermediary or asset manager
c) private investors with minimum assets of 2 million Swiss francs, excluding direct property investments
For details, click here.
The fund is distributed in Switzerland. Legal and natural persons residing in Switzerland are admitted. In individual cases, investors residing in other EU countries may participate, with the exception of U.S. Americans / "US Persons", who are excluded.
The funds are predominantly invested in Swiss real estate, but not limited to them.
There is a myriad of mezzanine fund types and providers. The Bargella mezzanine fund focuses on properties instead of industrial or other projects. Therefore, investors profit from opportunities on a specific market, drawing on the expertise and strategic Bargella Group knowledge. Investors do not vouchsafe a subordinate loan, nor are they silent partners, they are shareholders in a corporate company as dictated by Luxembourg laws (SICAV). Therefore, as an investor, you have the right to access documents and participate in decision-making.
The fund uses a specific loophole. Equity regulations and measures to counter economic overheating create a market imperfection that grant private investors profit opportunities via regulatory arbitrage. Debtors are willing and able to pay substantially more for a mezzanine credit (7 - 14%). This generates a solid basis for returns (the business plan calculates with 8.5%). With modest and well-structured fund fees, interesting dividends can be distributed. According to the business plan, capital can reap up to 9.85% interest. Please note that a business plan reflects a projection based on realistic assumptions, and is not to be taken as a prognosis or guarantee. This plan illustrates the possibility of above average yields based on realistic assumptions.
The so-called end yield of 5% primarily serves as a reference value to define performance fees (15% of performance above end yield).
Luxembourg draws on political stability and financial solidity similar to that in Switzerland. The Grand Duchy has – also comparable to the Swiss banking sector – established a strong tradition of professionalism in funding. Fund providers and investors both profit from expedited processing time and/or lower costs. Regarding investor protection, Luxembourg fulfils high standards, despite, or precisely due to, loud criticism in the wake of the financial crisis.
10 years with 2 options, each a 2-year extension (per shareholders' resolution). There is no repurchase obligation prior to the 10-year term.
The placement fee accounts for your investment sum in relation to the fund’s consistent expenditures. The placement fee is 2.5% by an investment up to 5 million Swiss francs. With higher sums, it is correspondingly lower. For details, please refer to your subscription document.
An annual advisory fee of 1.3% and an administration fee of 0.3%. Should the fund management exceed the target yield of 5%, they are entitled to an additional 15% of the generated yield. The remaining 85% is distributed among investors. We estimate the maximal total expense rate (TER) at 1.9 %.
Disclaimer: We do not offer tax consulting and recommend investors have their individual situation examined by a tax consultant prior to investing.
1.Bargella Real Estate S.A. SICAV-FIS is classified as a distribution fund*
2. Withholding tax does not apply.
3. Proceeds are taxed according to each investor's tax stipulations (transparency and trust principles).
4. The fund pays only a minimal annual subscription tax in Luxembourg.
5. Pension pools and funds are generally tax exempt. This does not include taxes applicable to change of ownership or property profits. Bargella Real Estate S.A. SICAV-FIS offers the opportunity to profit from real estate value growth without change of ownership and property profit tax burdens.
* Dividends at least 70 % of the annual net income. See general Swiss tax administration: Taxing collective investments and their investors. Circular letter No. 25, 5.3.2009