Frequently asked questions
What is Brickowner?
What is Brickowner?
Brickowner is a property investment crowdfunding platform that allows individuals to choose and invest into property using the Brickowner online platform. Whilst invested in the property users will benefit from any income and capital growth generated by the property during the investment period.
What is Property Crowdfunding?
Property Crowdfunding is the term used to describe a number of investors joining together to invest in a property, so as to benefit from a share of any income and any change in the value of the property.
Properties and Managers
Newly Listed Properties
Newly listed properties are properties which Brickowner place on the platform in order to crowdfund the necessary funds to complete the investment in that particular property.
Funds you commit into a newly listed property investment become ring-fenced for that investment.
Properties and managers
When selecting which property investment opportunities to place on the Brickowner platform different factors have been taken into account. The initial focus is on property with good potential income and capital growth prospects.
PROPERTY INVESTMENT PURCHASE COSTS
All the associated initial costs of the property investment are paid from the amounts raised from the investors.
The asset managers of the properties on the Brickowner platform have been chosen for their track record and experience. Relevant details of the manager and their respective track record can be found by the details of the property investment opportunity on the Brickowner platform.
The Brickowner platform will primarily offer property investment opportunities where the underlying property is managed by a third party and owned by a third party Special Purpose Vehicle.
WHAT HAPPENS IF A PROPERTY BEING FUNDED ON BRICKOWNER FAILS TO BE FULLY FUNDED?
If for some reason a property on the Brickowner platform doesn’t complete its funding target, any funds that have been committed by investors will be reimbursed in full along with any platform fee that might have been charged. These will be reimbursed into the user’s Brickowner wallet.
Documents concerning the investment
When investing you will be governed by the standard Brickowner investment documents. Sample documents can be viewed via the platform.
Investment nominee structure
Your shares in the Brickowner shares are held by way of a nominee, where the nominee is the legal shareholder of the relevant shares, and holds those shares on your behalf with you benefitting from all the economic interest as the ultimate beneficial owner. The nominee is a UK Limited Company owned by Gallium Fund Solutions Group Limited.
BRICKOWNER SHARE CLASSES
Each property investment is made by Brickowner Investments Limited, which will create a separate share class in respect of that investment opportunity. It is the beneficial interest of the shares in this class which the investor purchases. In turn, Brickowner Investments Limited will itself act as a single investor into the underlying Special Purpose Vehicle that owns the property.
Your shares in Brickowner Investment Limited are held by way of a nominee, where the nominee is the legal shareholder and holds those shares on your behalf with you benefitting from all the economic interest as the ultimate beneficial owner. The nominee is a UK Limited Company owned by Gallium Fund Solutions Group Limited.
Brickowner Investments Limited is a small registered alternative investment fund manager (with reference number 775256) and is not authorised or regulated by the Financial Conduct Authority.
All marketing and related material is approved by ShareIn Limited for the purposes of section 21 of the Financial Services and Markets Act 2000. ShareIn Limited is authorised and regulated by the Financial Conduct Authority with Firm Reference Number 603332.
Income, and Capital Return
Am I kept updated on my investment?
You are able to keep track of your investment and any income via the Brickowner website. We will also keep investors aware of any potential changes that might occur concerning the investment property.
CAN I INVEST MY INCOME?
Yes, the dividend you receive from your share of the property investment income is yours to do with as you wish.
HOW DO I EARN INCOME AND CAPITAL GROWTH?
Once you have invested, you will beneficially own a portion of the property investment via shares in Brickowner Investments Limited. You will receive a pro rata share of the monthly dividend in proportion to your ownership of the relevant share class. The value of your investment will also proportionally change with any change in the value of the underlying property. The dividend paid to the property investors is calculated by deducting any relevant costs of the property investment and Brickowner from the gross income. When dividends are due they will be paid on the 9th of the month
Will I be required to put in further capital?
Under no circumstances will you be required to provide further capital. All ongoing costs are funded from the gross income, and allocated funds and upfront costs are provided for during the initial funding of the shares.
It is possible that a cost could arise that could be greater than the gross income or allocated funds, and which had not been provided for as part of the initial funding. In such a situation Brickowner reserves the rights to take out a loan which would be secured against the investment or Special Purpose Vehicle holding the particular investment. The loan would then be paid back from subsequent gross rent or from the subsequent sale of the investment.
Investment Period, and Exit
How do I exit my investment?
When you exit your investment you will realise any capital profit or loss of that investment (see Key Risks)
Each investment will have a defined investment term length which will be clearly conveyed to the investor at the time the property investment is first funded on the platform. This date will generally be governed by the specific manager that will be managing that property.
WHAT ARE THE TAX IMPLICATIONS OF INVESTING VIA BRICKOWNER?
Your investment in property is made via the purchase of shares in Brickowner Investment Limited, a UK limited company. The relevant shares are issued specifically to fund the acquisition of an interest in property investment.
Brickowner will be subject to Corporation tax, and will pay this tax directly to the UK tax authorities.
There is no stamp duty payable on the subscription for the Shares in Brickowner or on redemption of the Shares.
Personal tax (payable by investors)
All investors should seek independent tax advice in relation to their personal tax position.
Implications of tax on projected returns
All projected returns are gross of tax, including any corporation tax.
What information does my dashboard provide?
The dashboard is there to help you monitor and keep track of your investments, as well as showing how much cash you have in your wallet.
How do I fund my Brickowner account?
You can fund your Brickowner account in two ways:
1. Debit card.
We accept Visa Debit, Visa Electron, MasterCard, Solo and Maestro. The funds appear in your Brickowner account immediately.
2. Bank transfer.
The funds can take up to three business days to appear in your Brickowner account.
Your money will be held in an online wallet by MangoPay, which is a trading name of Leetchi Corp. S.A. Leetchi Corp. S.A. is a public limited liability company incorporated under the laws of Luxembourg and approved as an electronic money institution by the Luxembourg Financial Sector Supervisory Commission (www.cssf.lu).
If you fund your account in a currency other than GBP, your bank will convert the amounts at their specified exchange rate.
Our minimum investment is £100
What’s the process for withdrawing funds from my Brickowner account?
You are able to withdraw funds from your account at any time. This can be done by going to the “My Account” page. Withdrawals to UK bank accounts take up to 3 business days to clear. Withdrawals to non-UK accounts can take a little longer.
All withdrawals are in GBP and your bank will convert the amounts at their specified exchange rate.
Can I withdraw invested funds?
After you have subscribed to an investment, you will not be entitled to withdraw your subscription money unless either
(1) you do so within 14 days or
(2) the funding target is not reached and the
Investment does not proceed. If you wish to withdraw from an investment within 14 days of subscribing, please email us at firstname.lastname@example.org.
Fees and Costs
Is there a charge for funding my Brickowner account?
Brickowner does not charge for funding your account. We cannot advise on charges your bank may levy.
Is there a charge for withdrawing funds from my Brickowner account?
Brickowner will not charge you for withdrawing funds to a UK bank. A cost may apply for international transfers.
What are Brickowner fees?
Fees are outlined within the property term sheet for each specific investment.
This applies to all investments launched on the platform since December 2018.
PROPERTY RELATED COSTS
All costs associated with sourcing, managing and disposing of the investment are paid by Brickowner. Such costs will include, but are not limited to, company related costs such as accounting and legal costs, as well as costs associated with the ongoing upkeep and management of the investment, such as ongoing surveys, valuations, and maintenance of the property as deemed necessary.
Can you invest from outside the UK?
Yes, however you are responsible for making sure you comply with the laws of your jurisdiction, including any governmental or regulatory requirements. We are however, not currently accepting investors from the US.
Security of investment
Is my investment protected if Brickowner ceases to exist or falls into financial difficulties?
Brickowner has procedures to reduce the likelihood of shareholders losing money for any reason other than a drop in value of the underlying property. Each property investment is made through a dedicated share class. Brickowner is constituted to restrict its ability to incur liabilities that exceed the property value associated with any given share class and the costs of each property investment are attributed only to that share class. Costs that are not directly related to a specific property investment are the responsibility of other companies in the Brickowner group, so that shareholders in Brickowner Investments Limited should not be affected by them.
All money held in your account, which is not invested is held in a Mangopay client account.
These funds are completely separate and ring-fenced from any funds of Brickowner, and as such would not be affected by anything that might happen to Brickowner. The money would simply be returned to investors if Brickowner fell into financial difficulty.
What can Brickowner do to protect investors if an investment fails?
The exact details of the security offered for an investment will be outlined within the relevant Information Memorandum. For the majority of investments offered on the platform Brickowner Investments Ltd has the right to take control of the assets of the company holding the investment in certain default scenarios. The majority of investments will also be protected with a restriction at the land registry preventing a sale of the asset without the consent of Brickowner Investments Ltd.
Is my investment covered by the Financial Services Compensation Scheme (FSCS) ?
This is the rate that the Bank of England will lend to banks, it is set by the Bank of England’s Monetary Policy committee and therefore will affect the interest rates charged and paid by banks to lenders, customers and investors.
This is the difference between the change in value of an investment and the cost of the investment. A capital gain is realised when the sale price is greater than the previous investment price. Capital gains are usually subject to capital gains tax.
Capital Gains Tax
Capital Gains Tax is a tax on any profit made when you sell (or ‘dispose of’) something (an asset or investment) that’s increased in value when taking into account the original investment cost. It’s the gain you make that’s taxed, not the amount of money you receive.
Debt refers to an amount borrowed by one party from another, there are usually terms agreed which define the length of time and the amount to be paid over the term of the debt, including any interest.
Property development defines building a new structure or improving existing structures of a property with the aim of increasing its value. A developer may be an individual but often it is a company or a corporation.
Distributions refer to payments of capital gain or income to investors.
A dividend is the amount paid to the investors in Brickowner shares. The Dividend amount is the gross income less all associated costs and company taxes.
The dividend yield is the dividend given as a percentage of the total funded amount.
This refers to the research and appraisal of an investment prior to purchase. Due diligence is carried out to evaluate the returns and risk of a property investment.
When an investor agrees to fund part of a property, until that investment is made, money is held in escrow for the investor. This means the money is retained by a third party (Mangopay) on behalf of the investor until it is invested. Your money is held in trust to keep it separate and protected.
Fair Market Value
This is an estimated market value based on what a market participant would pay for the property.
Financial Conduct Authority – the independent financial regulatory body of the UK. Brickowner Investments Limited is a small registered alternative investment fund manager (Reference number: 775256) and is not authorised and regulated by the FCA.
The funding target is the total amount that is raised for an investment including all costs associated with making the investment.
‘Gearing’ is the use of borrowed capital to part fund a property purchase or investment. A mortgage uses gearing to fund a portion of a property. It’s attractive to investors because it offers the opportunity to enhance returns; however, it also increases the risks. It is also known as leveraging.
Gross Development Value (GDV)
Gross Development Value is the projected market value of a property once all the development work is completed.
The gross income is the total income received from the investment prior to any deductions for costs or tax.
Gross profit refers to the total amount of money made as the result of an activity. It represents the full return before the deduction of any costs or fees.
Interest is the cost payable by investors to financial institutions for borrowing money.
Internal Rate of Return (IRR)
Internal Rate of Return is a measure of the profitability of an investment, it provides a present-day value based on future returns.
A sum of money which is borrowed and later payed back with interest. Terms of the loan are agreed which specify the length of time for which the sum is borrowed and the terms of its repayment.
Loan to value ratio
Loan to value (LTV) ratios tell us how much capital vs how much debt is owned on a given property (i.e. mortgage). A higher LTV is often seen as higher risk than those with a lower LTV.
Net Annual Dividend
This is the annual income received from a property less applicable costs, fees and expenses.
Net profit is the difference between the total invested amount and the present value, minus all fees and deductions.
Net Total Annual Return
This is the total annual return received on your investment less applicable costs, fees and expenses.
The projected return is the total projected return over the investment term, including all projected income and capital growth.
This is the valuation expressed on a per share basis.
Stamp Duty Land Tax
You must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England, Wales and Northern Ireland. Further information is available here https://www.gov.uk/stamp-duty-land-tax/overview
Stamp Duty Reserve Tax
Stamp Duty Reserve Tax is an amount payable to HM Revenue & Customs for acquiring shares in property investments owned by a UK company. The amount payable is 0.5% of the cost of those shares. https://www.gov.uk/guidance/stamp-duty-reserve-tax-the-basics
Special Purpose Vehicle (SPV)
Property will generally be registered in the name of a Special Purpose Vehicle (SPV). An SPV is a limited company which helps ring-fence any liabilities associated with that property.
The total gain or loss generated from holding an investment.
A yield is the income return you will get on an investment made. Yield is usually expressed as an annual percentage rate based on the investments cost, or market value. For example if an investment costs £100 and produces and income of £10 over a year, the yield is 10%.