TLDR;
Pedro da Fonseca shares his strategy for building a property portfolio worth nearly €5 million by leveraging business acquisitions. He details how he uses the cash flow and borrowing power from acquired businesses to finance property investments, focusing on commercial properties, studios, and co-living spaces. He emphasises the importance of leveraging debt and business revenue to acquire properties, aiming for high cash flow and significant capital appreciation.
- Leveraging business acquisitions for property investment.
- Focus on cash flow and capital appreciation.
- Importance of debt and business revenue.
Introduction [0:00]
Pedro da Fonseca introduces himself as a business acquisition specialist and property investor. He aims to explain how he built a property portfolio worth nearly €5 million by leveraging business acquisitions. He promises to share detailed financial information, including cash flow and profitability, for all his properties. He encourages viewers to join his Facebook community for business acquirers and offers consultations for those interested in business acquisitions.
Local Commercial Property 1 [2:33]
Pedro discusses his first property, commercial premises initially listed at €1.5 million but negotiated down to €850,000. He invested €68,000, sourced from his sports club business, resulting in a total project cost of €918,000. The monthly loan payment is €6,208, while the rental income is €9,041, generating a gross monthly cash flow of €2,833, equating to over 13% profitability. The loan term is 13 years, and the property is now valued at €1 million. Additionally, the property includes a 105 square metre duplex, rented furnished for €1,250 per month, adding to the total cash flow.
Local Commercial Property 2 [4:29]
Pedro details a second commercial property acquired through another business acquisition. The property, nearly 1,000 square metres, was purchased for €600,000. He invested €148,000, including notary fees, bringing the total project cost to €648,000. Financed with a 10-year loan, the monthly payment is €4,580. The property generates €8,952 in monthly rent, resulting in a cash flow of €4,372, exceeding 16% profitability. The property's current value is €900,000.
Studio Apartment 1 [6:06]
Pedro discusses a studio apartment initially listed at €85,000 but negotiated to €73,000, plus €5,000 in agency fees. Operated as a short-term rental, the purchase was structured as an "acte en main," incorporating notary fees into the price, eliminating the need for an initial outlay. With notary fees at €6,240 and furnishing costs at €3,000, the total project cost was €92,240. Financed with a monthly payment of €478, the apartment generates an average monthly income of €1,555 through platforms like Airbnb and Booking. This yields a cash flow of €1,077 per month, representing over 19% profitability over 13 years. The property is currently valued at €95,000.
Studio Apartment 2 [7:14]
Pedro details another studio apartment, initially listed at €79,000 but negotiated to €57,500, plus €5,000 in agency fees. Used for short-term rentals, the purchase required a €62,500 outlay. Additional expenses included €4,600 for notary fees, €10,000 for renovations, and €3,000 for furnishings, bringing the total project cost to €80,100. Generating €1,555 per month from short-term rentals, the property yields a cash flow of €1,555, representing over 22% profitability. The property is currently valued at €97,000.
Studio Apartment 3 [8:09]
Pedro describes his "gem," a 25 square metre studio apartment initially listed at €45,000 but negotiated to €27,000, plus €2,500 in agency fees. Operated as a short-term rental, the purchase required a €30,000 outlay. Additional expenses included €2,400 for notary fees, €21,500 for renovations, and €3,400 for furnishings, bringing the total project cost to €57,300. Generating €1,555 per month from short-term rentals, the property yields a cash flow of €1,555, representing over 31% profitability. The property is currently valued at over €90,000.
Co-living Apartment [9:10]
Pedro discusses a four-bedroom apartment used for co-living, initially listed at €165,000 but negotiated to €148,000. The purchase required an €11,840 outlay for notary fees. Additional expenses included €19,000 for renovations and €6,500 for furnishings, bringing the total project cost to €180,340. Financed with a monthly payment of €843, the apartment generates €1,680 per month from renting out individual rooms (€550 for two rooms and €580 for the largest room). This yields a cash flow of €837, representing over 11% profitability over 20 years. The property is currently valued at €230,000.
Apartment Building [10:10]
Pedro details an apartment building, a bourgeois house divided into five apartments, covering 290 square metres. Initially listed at €290,000, it was negotiated down to €190,000. The property is used for a mix of short-term and long-term rentals. An outlay of €205,200 was made through his company, covering the purchase price of €190,000 plus €15,200 in notary fees. Additional expenses included €331,000 for renovations (financed by a bank) and €21,000 for furnishings (included in the renovation loan), bringing the total project cost to €536,200. Financed with a monthly payment of €1,731, the property generates €6,410 in monthly rent, resulting in a cash flow of €4,679, representing over 17% profitability. The loan term is 20 years, and the property is currently valued at €690,000. The building includes three studios rented for short-term stays at €1,555 each, a two-bedroom apartment rented furnished for €830 per month, two two-bedroom apartments rented for €1,190 each, and four parking spaces rented for €50 each.
Main Residence [12:15]
Pedro discusses his main residence, purchased new for €215,000. The purchase required a €20,000 outlay, with notary fees of €4,309, bringing the total project cost to €221,930. Financed with a monthly payment of €840 over 25 years, the property generates €840 in monthly rent, resulting in a 5% profitability. The property is currently valued at €250,000.
Parking Space [13:13]
Pedro details a parking space acquired with the co-living apartment. With no separate financing, the parking space is rented for €70 per month, generating €70 in monthly cash flow. The parking space is valued at €12,500.
Office Space [13:47]
Pedro discusses his office space, where one of his companies pays €400 per month to use the office in his main residence. This generates an additional €400 in monthly income.
Apartment Building 2 [14:19]
Pedro details another apartment building divided into five studios, initially listed at €250,000 but negotiated to €190,000. The apartments will be used for short-term rentals. The purchase required a €60,000 outlay, sourced from his companies. Additional expenses included €15,200 for notary fees, €146,700 for renovations, and €15,000 for furnishings, bringing the total project cost to €361,700. Financed with a monthly payment of €2,147, the property is expected to generate €7,775 in monthly rent, resulting in a cash flow of €5,628, representing over 25% profitability. The loan term is 20 years, and the property is expected to be valued at €450,000. Each of the five studios will be rented for short-term stays at €1,555 each.
Sub-letting Apartments [15:34]
Pedro discusses a sub-letting arrangement involving 16 apartments. These apartments generate €24,880 in monthly rent, with an average monthly rent of €520 per apartment, costing him €8,320 per month. This yields a cash flow of €16,560. The leases for these apartments are valued at approximately €200,000 and can be sold like a business.
Local Commercial Property 3 [17:04]
Pedro details his latest commercial property, acquired for €300,000. The property is used as office space for his business. The purchase required a €100,000 outlay, sourced from the acquired business. Additional expenses included €24,000 for notary fees, bringing the total project cost to €324,000. Financed with a monthly payment of €2,191, the property generates €5,041 in monthly rent, resulting in a cash flow of €2,850. The loan term is 10 years, and the property is valued at over €700,000.
Summary [17:53]
Pedro summarises his property portfolio, which generates €71,004 in monthly rent. With monthly loan payments of €19,018, the portfolio yields a cash flow of €43,666 per month. The total value of his property portfolio is €4,714,500. He invested approximately €700,000 to acquire these assets, leveraging debt and business revenue to achieve significant growth. He emphasises that he does not own his main residence to maintain flexibility for further investments.
Conclusion [19:42]
Pedro concludes by highlighting business acquisition as a fast and effective strategy for wealth creation. He reiterates his strategy of acquiring businesses, using their cash flow to purchase properties, and then selling the businesses for a profit while retaining the properties. He encourages viewers to join his network and schedule a consultation to discuss business acquisition opportunities.
