Projects funded through Walliance must meet specific parameters, set out below as general criteria. Due to the peculiarities of each project, Walliance reserves the right to apply greater or lesser margins of flexibility.
What are the general evaluation criteria?
1. The Developer
As a first step, an analysis is performed on the operator developing the operation. Here, multiple factors are to be considered:
background of the candidate Issuer, in order to verify the existence of any pending litigation or other items of concern that have occurred in the past;
experience in the real estate or renewable energy sector and, in particular, in projects similar to the one proposed;
references obtained from lenders, investors, or other stakeholders of the operator.
2. The market
The market in which the operation is realized is another criterion for analysis. There are many factors considered.
Demographic data of the area in which the intervention is developed, such as total-population, average income, number of transfers, etc.
Economic trends of the market in that specific area, taking into analysis the trend of sales prices and the trend of transactions.
Information from market comparables, then operations similar and comparable to the potential investment, is then examined.
For real estate projects, primary locations are preferred.
3. The asset
Another key factor is the quality of the intervention that will be developed, examined in terms of the adequacy of the work plan and business plan. The quality of the property or asset, including its current condition and the proposed business plan or spending plan, is considered.
In addition, the analysis team physically travels to the site of the intervention to confirm the location of the property, the characteristics of the building, and the conditions specified by the Issuer.
4. The investment
At the final stage, the proposed investment agreement is reviewed, sometimes revised so that it meets legal requirements and incorporates any clauses to safeguard the investment.
The collection amount varies depending on the financing instrument selected.
Real estate projects that can distribute a gross annual return of 10% or more of the capital contributed through the Equity or Lending crowdfunding campaign are evaluated, within a time period of 6 to 36 months for projects in the Walliance Crowd division.
The operation should be able to generate a profitability of at least 30%.
The financial structure of the operation generally must meet these criteria:
30% to 50% of the project's financing needs can be covered by a lending institution;
the entrepreneur must commit his or her own means to 20% to 40% of the capital required to finance the project;
about 30% of the required capital can be raised through Walliance.