Audioboom Grp. Regulatory News (BOOM)

5 Mar 2007 07:01

Off-Plan Fund Limited (The)05 March 2007 For Immediate Release 5 March 2007 The Off-plan Fund Limited Valuation Announcement & Update The Board of The Off-plan Fund Limited (the "Fund"), which specialises inproviding forward finance to UK housebuilders, is pleased to announce the Fund'squarterly valuations for the periods ending 30 September 2006 and 31 December2006. Highlights •Sales at Liverpool site progressing well - 25 sales achieved at a 134% ROI •Increase in NAV by 1.7p per share between 30 September and 31 December 2006 •Decision to rescind contracts at Nottingham site •Strong pipeline of future investments Period ending 30 September 2006: •The unaudited net asset value of the Fund prepared under historical cost convention as at that date was £7.75m (83.5p per share compared with 84.6p as at 30 June 2006) •Using Red Book* valuations for the underlying properties, the estimated net asset value of the Fund was £8.2m (88.1p per share compared with 95.1p as at 30 June 2006 reflecting the effect of the rescission of the Nottingham contracts mentioned below). Period ending 31 December 2006: •The net asset value of the Fund prepared under historical cost convention as at that date was £7.9m (85.18p per share). •Using Red Book* valuations for the underlying properties, the estimated net asset value for the Fund was £8.15m (87.4p per share) The Board expects to present the audited year end financial statements toshareholders by the end of March. Update on the investment at Oldham Place, Liverpool Following the acquisition of all 51 units at the development in Oldham Placeannounced last year, the Fund has been actively marketing the site during thelatter half of 2006. The Board is pleased to announce that as at 31 December2006, 25 units had been exchanged (sales of £4m) and a further nine are underoffer. As a result of these exchanged contracts the Fund has booked a profit of£227,921 on the original investment of £169,607 - a return of 134%. The impacton the NAV is an increase of circa 2p per share. The deposit paid on the entiredevelopment was £332,489 thus, with the return of the deposit in respect of theexchanged units and the profit realised of £227,921 (ie £397,528 in total), theFund is in profit overall and expects to increase the margin considerably on thesale of the remaining units. Several offers have been received on the remaining 17 units, however the Managerbelieves better prices may be achieved as the development progresses.Construction is due to commence in the next month with completion due inDecember 2008. Liverpool remains a strong candidate for further investment and the Manager hasidentified further opportunities in the area. Update on investment at Waterfront Plaza, Nottingham Over the past nine months the Fund's advisers have been in discussions with thedeveloper regarding the progress of the site. Owing to a number of issuesrelating to the development beyond its control, the Fund was prevented fromselling the relevant units and realising the returns originally envisaged.Accordingly the Board has executed its right under the acquisition agreement torescind all 30 contracts rather than pay the completion proceeds of £4.1m plus4% stamp duty. While it is unfortunate that the Fund has been unable to realise the valueoriginally contained in the investment, the Board and Manager believe that otheropportunities currently available offer the prospect of better returns and thatthe exit agreed is therefore the most beneficial to the Fund. Under the terms ofthe rescission the Fund has had £200,000 returned, which it will reinvest inforthcoming projects. Investment Pipeline Over the last 12 months the Manager has developed strong relationships withdevelopers, agents and lenders and a number of these contacts are now providingthe Fund with suitable investment opportunities in attractive locations, wheredemand is likely to remain strong.The Manager is currently in advancednegotiations with developers on four further sites in targeted locations with anaggregate gross development value of £25m. List of Contacts Development Capital Management Roger Hornett Andy Gardiner 020 7399 4270 Numis Securities Adam Shapton Charles Farquhar 020 7776 1500 Buchanan Communications Charles Ryland Isabel Podda 020 7466 5000 * The nature of the Fund's investments mean that, under current accountingstandards, the discounts to market value achieved by the Fund, cannot berecognised in the reported balance sheet. The Fund therefore obtains anindependent 'Red Book' valuation of the assets within the property portfolio inorder that shareholders can identify this additional value. The Red Book is theAsset Valuation Practice and Guidance Notes of the Royal Institution ofChartered Surveyors and is the industry standard method for valuing investmentproperties. The valuations were prepared by independent surveyors as at 30September 2006, the date of the last financial statements. Notes to Editors: •The Fund is managed by Development Capital Management (Jersey) Limited •The Fund provides a form of mezzanine finance through the acquisition of UK residential property, sold forward by developers as a means of securing better debt finance. The Fund then looks to sell the properties prior to completion. By utilising only the deposit and purchasing at a discount, the investment becomes highly geared, as do the potential returns. •Working with a number of developers, the Manager has been reviewing sites at the earliest stages of development. This approach allows the Fund to act as a strategic partner, building a relationship with the developer throughout the construction and marketing process and also enabling the Fund to make investments on terms that may otherwise not have been achieved. This information is provided by RNS The company news service from the London Stock Exchange