Cash flow projections for TAARD
Key Assumptions
- Project Overview
The development comprises a 26-floor premium mixed-use building, featuring 18 residential floors and a total of 46 apartments, configured as follows:- 12 units of 1-bedroom apartments
- 12 units of 2-bedroom apartments
- 8 units of 3-bedroom apartments
- 4 units of 4-bedroom (standard) maisonettes
- 4 units of 4-bedroom (premium) maisonettes
- 6 units of 5-bedroom maisonettes
- Commercial Space
The project, referred to as TAARD, will include 4,272 sqm of lettable retail space in addition to the residential units - Development Costs
- Estimated construction cost: USD45.68 million
- Demolition of existing structures: USD167 thousand
(based on March 2025 estimates)
- Construction Timeline
The total construction period is projected at 42 months, including the demolition phase - Funding Strategy
To mitigate financial risks such as delays in securing bridge finance or insufficient funding from convertible instruments, the project will adopt a diversified funding strategy. This includes engagements with:- Local and international banks
- Crowdfunding platforms
- Private equity investors
- Funding Sources
Project financing will be sourced through a mix of:- Equity
- Debt (convertible and non-convertible)
- Revenue from unit sales
- Bridge Finance
A USD2 million local debt facility will be secured to cover pre-construction expenses (including demolition)- Tenor: 12 months
- Interest rate: 25% per annum (inclusive of all fees and charges)
- Repayment source: Convertible debt raised via crowdfunding
- Offshore Convertible Debt
An estimated 29.3 million in USD-denominated convertible crowdfunding will be raised offshore. Associated fees and charges: 10% of total funds raised - Debt Repayment & Conversion
At project completion:- Up to 40% of the convertible debt will be repaid (at an average interest rate of 8% per annum)
- The remaining 60% will be converted to equity
- Additional Equity Injection
An additional USD 4.6 million in equity will be raised during construction to cover repayment of the unconverted 40% of the debt- Sources: Local and international investors
- This equity may also be used to repay any convertible debt exiting during construction
- Unit Sales Revenue
Twelve (12) apartments will be sold between Year 1 and Year 4 of the construction period, as follows:- 3 units of 4-bedroom (standard) maisonettes
- 4 units of 4-bedroom (premium) maisonettes
- 5 units of 5-bedroom maisonettes
Expected revenue from these sales: USD14.3 million
- Land Equity Compensation
Five (5) units will be allocated to MEL in exchange for their land contribution, comprising:- 1 unit of a 2-bedroom apartment
- 2 units of 3-bedroom apartments
- 1 unit of a 4-bedroom (standard) maisonette
- 1 unit of a 5-bedroom maisonette
- Short-Term Lettings
The remaining 29 apartments will be operated as short-term lettings at the following nightly rates:- 1-bedroom units: $150/night
- 2-bedroom units: $290/night
- 3-bedroom units: $357/night
- 4-bedroom maisonette (standard): $582/night
- 4-bedroom maisonette (premium): $665/night
- 5-bedroom maisonette: $710/night
- Retail Lease Income
The 4,272 sqm of retail space will be leased at $630/sqm per annum. - Occupancy Assumptions
- Residential short-term lettings: 75% occupancy
- Retail space: 80% occupancy
- Annual Rental Income Projections
- Residential short-term lettings: USD1.9 million
- Retail space leases: USD2.1 million
- Equity Investment & Returns
Upon completion, the project will have attracted a total of USD26.6 million in equity investment. Based on projected annual revenue of USD4 million
from lettings, equity holders in the project’s SPV (TAASL) can expect an annual ROI of up to 13.4% - ROI Summary
The anticipated annual return on investment (ROI) for debt investors is in the range 6 – 10%, based on current income and cost assumptions - Foreign Exchange Rate
All USD-denominated values are based on an exchange rate of NGN1,500 = USD1
Input Sheet
Cash Flow
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Unit 1 Block C, Plot C, 5th Avenue Banana Island Ikoyi, Lagos Nigeria
+234 812 000 0001, +234 907 808 0743
info@theafropolitanapartments.com
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