Developer's Problem:
Local Authority commuted sums are calculated based on 1-2% return on investment (ROI), as a capitalised sum, using the interest received to maintain their adopted open space land.
OASIS Solution:
OASIS invests in low-risk, stable assets that rise in value as fast, or faster than background inflation. These assets yield a return on the capital, typically 6-9% net ROI. By providing a higher yield strategy, the commuted sums can be reduced for the developer.
Of the net yields, 70% will be spent on maintaining the open space, with the remaining 30% needed by OASIS to cover its own costs. For example, if a net return is just 6%, 70% of this is 4.2% - more than double than bank interest.
How OASIS Invests:
- Buy, refurbish and retain investment property in sought after locations.
- Conversion into high-end, 5+bedroom HMO’s and letting to young, stable professional people who have pride in their home.
- Providing high-end accommodation, letting through top, professional agents and managing the properties well.
Example of Investment
Bishops Road, Bury St Edmunds
Two high quality Victorian conversions in the heart of Suffolk, close to fantastic amenities. Whilst still managing to retain many of the original features, these 5-bedroom properties, benefit from new kitchens, large communal dining rooms, new bathrooms, and efficient heating and lighting.
Kitchen before
Kitchen after
Bathroom before
Bathroom after
Bought for £267k with £67K deposit (25%), plus £70k renovation cost, 10K stamp duty, 5K mortgage fees and HMO licence – the property is now valued at £550k thus creating £398K equity with a Net rental annual profit after all costs of £12k per annum (solid yield of 8% ROI) which forms the OASIS land maintenance budget.
Failsafe
OASIS establishes independent limited companies for each site it acquires. The legal framework ensures that the obligations of OASIS are guaranteed by the parent company and OASIS cannot dispose of the assets for any other purpose. In the unlikely event of a default or failure of the management company, the value of the assets is protected under the guarantee. OASIS therefore ensures the maintenance obligations are underwritten by the retained value of the investments. These values have grown ahead of inflation.
Supportive Partnerships with Communities
OASIS works with the communities and encourages their involvement and use of the land. OASIS believes that through active liaison with residents, it can help bring communities together and ensure open spaces remain at the heart.
- We engage regularly with residents and respond to their concerns.
- We regularly visit and survey all OASIS sites. We often meet residents on site and listen to their opinions.
- We are Landscape and Management Experts, and help people get the most out of their local open spaces.
- We regularly provide works or resolve issues for residents. The relationship is always positive, as it comes at no cost to them.