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Gilles Trignat Résidences

presented by October France

€2,075,000

7.05%

36 months

B

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location

Location

La Tronche, France

activity

Activity

Properties

Presentation of the company

Gilles Trignat Résidences is the holding company set up in 1994 of the Gilles Trignat group, active in the the real estate development and management sector. The group, managed by Gilles Trignat, has 11 employees and is based in La Tronche. Gilles Trignat is the creator of the group and is in the sector for 30 years. The group builds new housing mainly in the large Grenoble area, Savoie and Haute-Savoie.

The company’s main activities are the creation and construction of new high-end housing.

The company works with private clients and investors.

The group stands out from the competitors by its high-end positionning and good quality products.

Following the development stategy in Savoie and Haute Savoie, the group wants to acquire the Hotel-Restaurant Les Cimes, located in L’Alpe d’Huez. This is the opportunity for the group to own a very well located asset.

Project Description

Mr. Bernard Castillan wants to sell his shares on Hotel-Restaurant Les Cimes valued 985 000 € and the owner of the walls, Mr. and Mrs. Dauphin, wants to sell it valued 1 600 000 €, valuations based on standard of the market. SARL Gilles Trignat Résidences company, wishes to borrow 2 075 000 € over 36 months to finance the acquisitons. The balance will be self-financed. This project will be realised in the next months.

This project is a Flexible Bridge Loan, an amortizable loan with a standard commitment for the first 6 months and the possibility of early repayment at no cost for the remainder of the loan term, even in the event of refinancing by other financial institutions.

The amount offered on the platform is limited to 1 000 000€, which is in line with the regulatory limits.

Analyst’s Opinion

The borrower is a holding company whose revenues are derived from services invoiced to its subsidiaries. The financial analysis was carried out on consolidated financial statements, which reflect the group’s performance.

With a turnover of 29 639 000 € in 2017 and an experienced team, the group has a good track record combined with a two-digits operating margin.

The increase of the revenue and the profitability is linked to the lands development and a good costs management. The forecast is based on the 2018 landing with 35M€ of turnover and the average margin level of the last few years.

The group has a correct repayment capacity with a forecast FCCR (Fixed Charge Cover Ratio *) at 1,07 and an excellent financial structure, with a forecast net debt / ebitda ratio of 1,9 and a net debt / shareholder equity of 72%.

Total debt has been restated from inventories under construction with a conservative discount.

The analysis of the project leads to a credit rating of B and a 7,05% annual interest rate.

*The multiple of FCCR at 1,07 means that the company has a safety margin of 7% relative to its ability to repay its credit maturities.

The expert opinion is given as an indication on the basis of the elements provided by the project holder and information from our databases (External data provider). This opinion is only an element of reflection in the decision making of a lender to participate in the financing of a project.

Strong points:

  • Good historical performance based on diversified client base.
  • Correct repayment ability with a forecasted FCCR of 1,07 reinforced by the support of shareholders.
  • Experienced builder in a specific market.

Points of caution:

  • Cyclical real estate development activity.