The FINANCIERE TEYCHENE Group – Investing for you
In both France and Belgium, the Group makes use of a varied array of effective financing tools, appropriate to each type of investment transaction.
Whether investing directly in property or through the taking of interests in company equity, assigning finance-leased assets, engaging in partnerships with developers or investors, real-estate piggybacking, development transactions, etc., the Group is able to adapt to the needs and inclinations of its partners and to the special features of each transaction.
The Group purchases the full title (“freehold”) to the real-estate asset, financing the acquisition within a maximum of 10% from their own funds, with the balance being financed by a conventional bank loan repayable in instalments over a period of 15 to 20 years, preferably at a variable rate. As a rule, the bank takes out a mortgage or a mortgage authorisation covering the real-estate asset.
Real-estate finance lease
The financing bank purchases an emphyteutic (long-term lease) right with a term of 27 to 99 years and thereupon leases the asset to the Group through a property finance lease (recognised off balance sheet) with a term of 10 to 18 years. At the term of that property finance lease, the Group has an option to buy out the emphyteutic lease (at a price between 10% and 25% of the value of the emphyteutic lease). The Group also has the option of re-letting, in order to prolong the real-estate finance lease. The Group may own the ground beneath the property or it may be owned by a totally independent company.
Financing of equity investments
Some acquisitions involve purchasing equity interests in a company; hence, the Group may on occasions finance the acquisition of shares in companies. Financing in this case usually takes the form of a loan for a term of 5 to 7 years, repayable either in instalments or as a bullet loan.
For some transactions, the Group may initially invest in cash for reasons of speed and responsiveness.