property valuations

Pump some Biofuel into your Portfolio for Peak Performance

As successful investors will know the secret to a robust portfolio is diversification, strategically spreading risk between stocks, shares, traditional investments and increasingly, alternative investments. Interest in biofuels as an alternative investment has grown in recent years as Sydney property valuation and savvy investors move to capitalise on the serious situation we face, namely that we are currently using more crude oil that we are finding it and so new sources of renewable energy must be found.

And that clean, renewable energy can in fact be found growing on trees. Demand for biofuel (fuel derived from biomass) has never been greater with projections of a 20% annual increase through 2011 according to the Earth Times. World governments are injecting large sums of money and resources into the development of biofuels or ‘green oil’ in an attempt to reduce dependency on crude oil. Leading energy suppliers Shell are going one step further, strategically moving away from other forms of renewable energy such as wind and solar to biofuels as they are more financially viable.

As Steven Worboys, MD of the alternative investment experts at Experience International, comments,

“Biofuels hold many environmental advantages over fossil fuels which are negatively contributing to many issues facing the planet. Biofuels produce fewer carbon emissions than fossil fuels, are a renewable and sustainable alternative, make use of ‘waste’ materials such as corn stalks, they are less toxic due to their biodegradable matter and the production and extraction is less hazardous and invasive than fossil fuels.”

The commercial use of biofuel has been in operation since 2008 where 1.8% of the world’s transport fuel was from this source (UN Environmental Programme “Assessing Biofuels, 2009). Virgin Atlantic has already embraced the ‘green oil’ and airlines KLM and Lufthansa aim to offer biofuel flights from 2011. Many of the world’s largest economies in South East Asia, South America and Africa have biofuel sites in operation with jatropha being the crop of choice.

Cited as one of the best candidates for future biofuel production by Goldman Sachs and touted as a ‘miracle biofuel’, jatropha is a bushy shrub, resistant to drought and pests which grows on marginal land not suitable for food production. The jatropha seed contains up to 40% non-edible vegetable oil which can be used as a biofuel. India is reported to have set aside 100 million acres of land for jatropha and expect the oil produced to account for 20% of its diesel consumption by 2011.

Worboys goes on to comment,

“Such strong commitment should bolster investor confidence in Green Oil Programmes. Through these sound business models, investors can own in effect an ‘oil property’, an area of land with biofuel producing plants producing oil yearly, in turn providing annual revenues of potentially 20% over a 45 year lease term as well as an increasing capital asset value. Investment in these Green Oil Programmes, which are SIPP compliant, starts from as little as £15,000 and offer investors an innovative way to include an alternative investment in their portfolio as well as building long term income.”

For more information on ensuring your portfolio is at peak performance by investing in biofuels then contact the experts at Experience International on + 44 (0) 207 321 5858 or visit www.experience-intrnational.co.uk.

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property valuations

Why I’m tempted by Turkey

A huge land of stunning coastlines, rich ancient culture and vibrant traditions, Turkey is a fast-changing nation that still offers bags of potential.

On the far Eastern fringes of Europe – and one day no doubt, Melbourne property valuers – a member of the EU – this nation is a fascinating fusion of East and West, alien enough to be slightly exotic, yet familiar enough to be accessible.

A 4-hour flight away from the UK, with a higher volume of direct flights than five years ago, it offers a fantastic climate and a rapidly expanding tourism sector.

Tour operators report that many British travellers have preferred it to the overpriced Eurozone, making it our popular package destination, whilst Turkish figures show that tourists increased by 11% during recent months.

What’s more, overseas mortgage providers are saying the same thing: Turkey has been one of our biggest markets in 2010.

It’s easy to see why. Vast swathes of the south-west coastline still offer highly affordable property in relatively unspoilt resorts close to superb beaches and natural beauty spots. Converts also point to the cheap cost of living, hospitable locals and authentic villages.

Whilst property prices have risen steadily during the last decade, it still offers great value when compared with other pieces of the Mediterranean coast and stricter planning laws have generally prevented over-building.

Capital appreciation has been especially healthy in British favourites such as Bodrum, Altinkum and Kusadasi but where you choose really depends on what you are after; Turkey really offers something for everyone.

For those after a well-established holiday resort, Kusadasi is a good choice with family-friendly amenities close to hand. Only an hour from the nearest airport, it’s not surprising that holiday rentals are booming there.

Bodrum is another well-oiled holiday hotspot, but a little more exclusive these days, with prices to reflect that. But, again, there’s a complete spectrum of property options within the one peninsula.

If you seek somewhere a bit smaller and low-key, Didim is a good choice, and its beach area (known as Altinkum) has been a big hit with British buyers in the last five years.

Or, for those seeking somewhere more relaxed and a bit greener, up-and-coming Akbuk has much to offer with its picturesque bay and small ex-pat community.

In coastal areas just beware of any issues relating to land-zoning and title deeds (or TAPU) – do your homework and ask around before taking the plunge.

Finally, for serious investors, there’s one place that’s hard to beat: Istanbul.

Whilst a beguiling city-break destination in its own right, Turkey’s second city, is a rapidly expanding business and residential hub ideally placed between Europe and Asia.

A severe shortage of accommodation to cater for the city’s burgeoning population – it has expanded by 340,000 in just 2 years – means a hugely profitable domestic rentals market is attracting overseas buyers.

Foreign companies are relocating there, top retail brands too, plus a new marina’s just been announced in the 2010 European Capital of Culture.

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property valuations

Best Bet Brazil

Brazil is a vast resource-rich emerging nation. Since Lula da Silva became president in 2003, the country has made unprecedented social and economic strides. Not only was Brazil little affected by the subprime crises that almost sank the west’s financial system, poverty has been reduced dramatically. Moreover, economic growth is forecast to reach 7.1% this year.

Of the four BRIC nations (Brazil, Russia, India and China) identified by Goldman Sachs in 2001 to become global economic powerhouses, Brazil exceeded all expectations last year to be ranked top for sustainable economic growth in the GS Sustainable Economic Score index.

Massive government investment has been allocated to infrastructure improvements including the north east where, for example, a colossal new airport purported to be South America’s largest is under construction in the state of Rio Grande do Norte near Natal.

Brazil’s north east has always been a popular domestic tourist destination. Though less known for international tourism, the area is increasing in popularity and set to grow further for a number of reasons, not least of which is that Brazil will host the 2014 World Cup and the 2016 Olympics. These events will inevitably boost international tourism and energise Brazil’s fledgling international property market.

Foreigners have bought property across the nine states of the north east, but some of the strongest interest at present is found in the three states of Rio Grande do Norte, Pariaba and Ceará, especially along the Atlantic coast – hurricane and earthquake free with unending palm-fringed crystalline beaches and 300+ days of sunshine a year.

The state of Rio Grande do Norte, after Antarctica, has one of the cleanest atmospheres on earth. Its capital Natal, named as a host city for the World Cup and with a population of around 200,000, is known as one of Brazil’s safest cities. At the foot of Natal’s spectacular Ponta Negra bluff is a charming cluster of shops, bars and restaurants overlooking an expansive beach. In the northerly environs of the city is an exclusive new spa development, Natal Ocean Club Spa Residence.

A 90km drive south is the picture postcard town of Pipa with its heavenly beaches. Further down the coast in the state of Paraiba near its 700,000 strong capital city of Joâo Pessoa, is the 150-hectare eco-friendly resort development of Tambaba, adjacent to a protected rainforest.

The bustling Ceará coastal capital Fortaleza with a skyline of high rise buildings has a population of over 2m and 3km of sparkling urban beaches. A popular domestic tourist destination, the Brisbane property valuation city’s urbanisation has been fuelled by an influx of Brazilians re-locating from the major cities of the south. That Fortaleza will be a 2014 World Cup host city and is a six hour flight from Lisbon makes it particularly attractive for property investment.

North east Brazil properties are relatively affordable compared, say, to their Caribbean counterparts. Capital appreciation is set to strengthen. But with any emerging market, painstaking research along with good independent financial, tax and legal advice is paramount. That some past European developments have stalled or failed completely is in part the result of over ambition and lack of due diligence.

Lula’s departure from office at the end of the year is not expected to have a major impact on the country. The two top contenders for president are José Serra, governor of Sao Paolo State and Dilma Rousseff, the government’s chief minister. Although Lula has endorsed the latter, reassuringly many observers expect continuity next January no matter who takes office.

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