New leaseback scheme launched in French Alps
03 September 2008
Property developer MGM has launched a new and more flexible sale-and-leaseback scheme for property investors buying property in the French Alpine region.
MGM’s new “Lease with Flexi Option” permits investors to use their home as much as they want and at more or less anytime of the year. The value of the weeks used is then deducted from the 3% guaranteed rental return on offer from the company.
“Increasingly owners regard their properties in the French Alps as year-round holiday homes, not just somewhere to go for winter sports,” says Nathalie Turchet, MGM’s London-based UK sales manager. “With our improved leaseback schemes they can enjoy the French Alps for longer periods in the spring and autumn months as well.”
The French sale-and-leaseback (propriete allege) property investment vehicle, was introduced by the French Government in the 1980’s.
It allows investors to buy property (often a new-build off-plan apartment) and then lease it back to a management company for a fixed-term of typically 9-11 years. The management company then sub-let the property and in return, guarantee the investor a year-round fixed rental income for the duration of the leaseback agreement.
Under the terms of the scheme, most properties qualify for a 19.6% VAT rebate from the French government.