2) UK land - average appreciation 50-70%p.a (the highest for land appreciation) - see www.voa.gov.uk

Completely untrue for undeveloped land- do you know what an average is? There may have been some years where UK land boomed by that amount but there are at least as many where it bombed. The last two years have been complete bombs. Average appreciation across long periods for undeveloped land sits with about the rate of inflation. Provided you pay the right price you ought to do OK . The issues with undeveloped land as an investment is you have to maintain it and keep squatters off, and it can be tough to sell if you need the cash quickly.

3) Land prices only increase after it has been converted from undeveloped/raw land to residential/commercial status. Buying and sellin land over a 3-6 mths it too short for land conversion to take place. This process takes +/- 5 years and if there are any complications it may even take up to 26 years (according to Walton's track record).

Partly true. Some land will never get converted especially in the UK. I note that Profitable Group are estimating returns in 3 years of 250% according to this Singapore TV advert. The position of Hounslow council on the Profitable Group Hounslow site is stated in this freedom of information request. They say they can see no circumstance where the Hounslow site would get planning permission. Someone is not telling the truth.

4) If you are dealing with land based in UK, there are restrictions on greenbelt land and there are 7 stages for those types of land to be converted, if allowed. Each stage takes min 6 mths.

Not true. Green Belt has legal protection in the UK. That does not mean it can never be converted but conversion is highly unlikely. The tiny chance of conversion is always completely misrepresented in advertising by land banking companies into an incredile opportunity.

The most common issue with land banking plots is you grossly overpay for the undeveloped land - sometimes as much as 15-20 times the actual value of the land. To put it in terms you might understand. Property with en bloc potential is a good investment generally in Singapore if you pay the right price.

If with other investors you pay a company S$15M for a share of an apartment worth S$1M that you cant live in and then even worse find it has zero chance of enbloc how will you get your money back?

From UK Guardian . They don seem too impressed with the Profitable Group.

Despite withdrawing its bid to take over Newcastle United yesterday, Profitable Group, a Singapore-based investment firm, has another plan to break into English football. Its scheme, Project Hero, is looking to invest in the development of footballers and "would look to sell to interested clubs and keep a significant share in the player by way of a percentage of the sell-on fee".

That manifesto has attracted the attention of the very similarly named Hero Global Football Fund, which has been attempting to establish itself on very similar terms. Working behind the Hero fund is the former Liverpool captain Alan Hansen. Working behind Project Hero is the former Liverpool captain Steve McMahon.

Some of Project Hero's other financial backers do not have an enviable business record. In 2007 three of the directors of Profitable Group – Tim Goldring, Nigel Blanchard and Neil Osborn – were behind the Profitable Plot Company that was the subject of a winding-up petition from the Department of Trade and Industry which was avoided when the company went into voluntary liquidation.

One of the Profitable Group's core businesses in Singapore is Profitable Plots, which purchases UK land and sells shares in it on the promise of enhanced value once planning permission is achieved. After repeated planning-application failures the validity of the scheme has been questioned, upsetting investors in Asia and Canada. Its Canadian client-services manager, Dan Strumos, insists there is nothing untoward since, he says, the Singapore government puts to death anyone guilty of "corporate shenanigans" (although Nick Leeson seems to have survived).

Meanwhile, the Hero Global Football Fund is consulting lawyers over Profitable's Project Hero plans.

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Added on August 29, 2009, 1:32 pmThis is a piece from the London Hounslow Chronicle on "Concorde Village" which Profitable were advertising on Channel News Asia September and October 2008. Profitable Group were advertising potential gains of 250% in 3 years. I wonder what they say now?

Is 'Concorde Village' a real opportunity?
It is a story that links a former feltham gravel pit with investors in Brunei, Singapore and Canada and an audacious bid to buy Newcastle United. Ed Saunt investigates what is going on at lower Feltham Lakes.

TO A Far Eastern investor 'Concorde Village' might sound like the perfect business opportunity. Backers could pick up a plot just two miles from Heathrow for just £8,000 with the promise of a 250 per cent return within three years.

Singapore-based landowners Profitable Group said the Lower Feltham Lakes site was ripe for a housing project comprising 1,000 homes and a recent entry on its website boasts that development proposals have already been submitted.

However, following an investigation by the Chronicle into concerns from investors and neighbours of the site, Hounslow Council has confirmed no such application has been received, while Profitable's UK communications consultants, Chelgate, admitted this week that the claims were untrue.

Mike Hardware, executive vice-president of Chelgate, said: "We know that's not true. I don't know why that's there because the council has not received an application and we are not intending to submit one in the near future."Chelgate is leading a consultation into proposed development of the former Feltham gravel pits off Chertsey Road but Mr Hardware admitted it would be at least four years before a planning application is even lodged with Hounslow Council.

Profitable Group - which last month put in a bid to buy Newcastle United - bought the land from housebuilder Taylor Wimpey for £3.15m in 2006 but the group's predictions of 250 per cent growth for investors would value the land at more than £100m.

The council has been inundated with queries from investors who fear they might not see any return on their money.

A man from Brunei wrote: "They (Profitable Group) have been marketing very heavily here and have been trying to persuade my family to buy some plots on their scheme. Have you any news regarding them? I fear they may be one of the many scams that are mushrooming around the world. With their marketing and information it is hard to believe that such ventures can be so profitable."

Another potential investor from Singapore, on the verge of buying 47 plots for £253,125 (S$700,000!), said he was told planning permission was likely to be granted in 2010 or 2011.

Read the follow on stories here
Scam fears over homes feltham: profit promise to investors despite planning risk
Developers press on despite public outcry
And a public response from Hounslow Council here
Development of this site remains highly unlikely
Sky Sports reported here that Profitable Group could not provide proof of funds in their purchase of Newcastle United

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Added on December 25, 2009, 1:59 pmFrom TKL blog


UK land sold by Land Banking firms has about a 1% chance of receiving planning permission over the next 20+ years.

That means you have a 99%+ chance of owning a piece of land that is almost completely worthless.(the land is typically marked up by 1500% when you buy it and resale on the open market without planning permission is almost impossible)

In roulette if you put all your money on a single roulette number you have a 2.7% chance of winning .
If you lose you will also find out immediately that you have lost all your money and should learn very quickly not to gamble.
If you win Roulette will give 35 times payout, not the two to three times offered by the land banking companies. Also immediately no waiting for 20 years.

If I were to sell an amazing investment opportunity of investing in a single roulette number with a 3 to 1 payout for winning in 20 years time I am sure I would be shut down and probably put in Jail.

Can anyone explain why are Land Banking companies not subject to the same scrutiny ?





This post has been edited by mcorp: Dec 25 2009, 01:59 PM

Shebby is sponsored - do some research in the UK like I did

Scam fears over homes feltham: profit promise to investors despite planning risk
Aug 13 2009 By Ed Saunt ,

A PROPOSED 1,000-home development in Feltham is facing claims it is part of an international property scam.

Hounslow Council has said the project to build on Green Belt land at Lower Feltham Lakes is 'very unlikely' to receive planning permission, yet landowner the Profitable Group - which put in a [failed] bid to buy Newcastle United last month - has been luring backers with promises of returns of 250 per cent within three years when the housing is built.

The council has been inundated with queries from worried investors in Brunei, Singapore and Canada, who say they have been told planning permission will be granted imminently and fear they are in danger of losing their money.
Continued......
Hounslow Chronicle Scam Fears Story

UK Guardian
.....Among those interests is "Profitable Plots ... a strategic land investment company". This offers the chance to buy land such as at Cherry Tree Grove in Colchester which, once planning permission is received, will instantly increase in value.

But how to reconcile those promises with two separate local authority refusals of plans to build a 77-bed and then 87-bed hotel at Cherry Tree Grove on the grounds that it is too far out of town and in a Countryside Conservation Area? One respondent during the planning application process thinks he knows the answer. "These companies purchase protected land and then make proposals for development. They then resell the land to investors at 10 times or more profit in Asia and Canada, giving the impression that planning permission will be achieved," the respondent wrote to planners.

Not so, says Profitable's Canadian client services manager, Dan Strumos. "These accusations are false. Our headquarters are in Singapore and that would be the last place on earth for corporate shenanigans because the penalty for it is death."

But could Profitable Group by any chance be a new incarnation of The Profitable Plot Company that was the subject of a 2007 application for compulsory winding-up by the then secretary of state for trade and industry, only voluntarily to appoint a liquidator six months later? The very same! Tim Goldring, Nigel Blanchard and Neil Osborn were directors of that firm and all are now listed on the Singapore firm's website.

Yeah right. Like all land banking sales people you blab on about the increase in value or the land at 15% or whatever. If all this Canadian and UK land is increasing at 15% per year why are they selling it in small plots in Malaysia and Singapore. UK interest rates are currently at their lowet rates ever yet no respectable financial authority is suggesting investing in Land Banking plots because they are rubbish investments of the lowest kind.

Question: If I sell you something worth 1 dollar for 20 dollars how long does it take to get your original money back at average 5% per year increase in value ?
Answer: 68 years without inflation, without profit.

According to this article here you have more chance of getting your money back on Roulette at Genting than you do by investing in Land Banking in the UK. The bet with the highest odds and highest payout in Roulette give 35 times instant return with around 2.5% chance of success. That is still 97.5% chance of failing.

UK Land banking plots 1% chance of payout in 20 years with around 3 times return.

So Genting is a lousy investment but still much better investment than land banking..

People confuse value with price. Value may increase. But if you pay 100 times the value then price will surely fall.
Every one of these UK and Canadian land banking scams is charging 15-100 times what the land is worth.
Profitable Group paid around 350 pounds per plot for Concorde Village to a very experienced UK land developer Taylor Woodrow. Taylor Woodrow knew the true value of that land when they sold it and they got a good price. Profitable probably paid double what the land was worth. But assume they didnt.

Profitable Group were selling Concorde Village at 8000 UKP per plot last year. That is a 2100% markup or 22 times increase.
If the land it doubles in value in 10 years it will be worth 700 UKP . Thats a 7300 UKP loss (or 91% loss) in 10years excluding interest you would gained by just leaving the money in the bank.

Profitable Group is now under investigation by the Commerical Affairs Department (CAD) in Singapore and have been added to the monetary authority of Singapore (MAS) investor alert list.