Tuesday, May 5, 2009

Vila Verde - The Great Bait and Switch - Part 1

Well folks, at last we are able to deliver the first in probably what will be a multi part installment of the "Great Bait and Switch" being carried out by one of the most infamous overseas property promoters in recent times. You guessed it, MRI.

Now to be honest, we are a little tired of writing about them, a serious change of record is required, but whilst they will insist upon arguably questionable marketing to the public, strong-arming the industry and generally stirring up all kinds of stink, we hope this will be the last articles we need to write about them. Unfortunately, given the size of info out there on this particular subject, it will be broken down into a few parts, so please be patient with us.

The topic for this post is the Cape Verdean development Vila Verde, built by Tecnicil. Under the old guise of MRI Overseas and/or Macanthony Realty International, a substantial number units were sold to the general public via exhibitions and the telephone.

All seemed well to begin with, especially with the likes of Amanda Lamb waffling on about it at every opportunity, and the alleged promise of direct flights from every conceivable airport according to MRI, and the "tying up of rental agreements", (which of course could only be fulfilled if you took their furniture packages, and their lifetime after sales package) most of which clients were reasonably OK with spending the money on.

All of a sudden though, things seem to have got a little sour. It all started around the beginning of this year, we began to receive the odd e-mail and comment about meetings being arranged by MRI to discuss the future of their off plan properties.

Of course, these meetings were not publicized to the general public, unlike the overseas property expos of old, one has to wonder what's going on there?

Well, judging by the barrage of activity on the few forums that haven't banned the use of MRI, Macanthony Realty, or any of the other variations on names the company seems to have (that aren't connected in any way at all of course!) it would seem the following is happening from what we can gather.

Basically, MRI have been suggesting that Vila Verde will not be completed, even at best, complete with substantial delays, and that developer Tecnicil is in financial trouble and about to go bankrupt, as a result they have been suggesting to clients that they should forget the Vila Verde investment, and conveniently switch to a project on the Silver Coast in Portugal, or perhaps consider something in Bansko, Bulgaria, of course, offering a "substantial discount" in the process, as an apparent "goodwill gesture" BUT (and here is the real sting) it just happens that you need to add more money to the deal!

Hmmm, so lets get this right, My deposit of 30%, (or whatever I might have paid in installments) is gone? Well according to MRI, yes.

And this new investment, it's a better deal? Well of course, flip now and we'll do you a huge discount, and no-one needs to say anymore about it!

Now it is unclear as to whether it has actually been stated beyond doubt by MRI that Tecnicil are filing for bankruptcy in a bid to get clients to conveniently forget about their investment with them, but according to the forums, it would suggest it is being heavily implied.

What is clear when you actually look around, is that Tecnicil are alive and well, keeping the public informed as best they can with a blog, http://vilaverde-resort.blogspot.com/ and have publicly stated a couple of interesting things;

"Mark Twain once had to write: "Rumours of my death have been greatly exaggerated" or even "This report of my death was an exaggeration" depending on who we believe had the original quoted properly.Whichever is true it must have been quite a shock for Mark Twain to have heard that he had been reported dead! Here at Tecnicil we were equally surprised to hear last weekend that we were going into liquidation, or was it that we had gone into liquidation...?Whichever of the rumours you have heard, we can assure you that Tecnicil is financially sound and Vila Verde Santa Maria will be finished."

followed by;

"With the disappearance of the larger real estate agents in the overseas property industry, we at Tecnicil have had to pick up the task of client communication. No small feat when you think that MRI alone had had dozens of customer service people to deal with the workload. Sadly these are no longer interfacing for us so we have to do it."

Good for Tecnicil, considering they are a fairly hefty developer to say the least, and are involved in infrastructure construction, hospital building and the like, as well as having various connections to the government through board members, on top of having connections with the national bank, are they really that likely to be going under? Slow, maybe, the next Bradford and Bingly they are not.

So where does all this leave everyone with deposits on Vila Verde?

Well, the suggestion that you should write off your deposit as a loss and wander into another development at a "discount" might sound attractive to start with. However, a few things to consider.

  1. How real is that actual discount?
  2. Is there any reason why the next development might not run into problems? After all, Vila Verde was the best thing since sliced bread!
  3. Is there any chance of the Vila Verde contract coming back to bite me in the proverbial?

Well according to the forums, the properties in Portugal are being displayed as P.O.A. (we would link directly to them on the various MRI/DCC sites, but that isn't allowed!) to see what we mean, the thread in question can be seen on Caboverde24 (see the first post on the link)

The question has to be, how should a discount on something that has no price be perceived?

As for the new development being on offer running into problems, well there is absolutely no reason at all that they won't, or, that this same farce will re-emerge again in a few years time.

Lastly, the knock on effect of walking away from a contract? Well, lets take a logical approach to this one.

Lets say I am a developer that is well connected to the government, and you have entered into a a contract with me. I have sold something to you at a reduced price because you have shown faith in the project at a very early stage, and the contract you have signed states that I will pay you penalties if I am late finishing, and also, in that small print somewhere in return, you the buyer are obliged to complete the final payments to me when I deliver the finished project.

Granted, we have not seen one of these contracts from the developer, but we are going to hazard a guess that there is not a clause stating that the buyer can walk away and forget it all mid way through the build. It's a contract. There are sections that have to be appeased by both parties.

There are already a few cases of people walking away from off plan deals, thinking "that's the end of it", only to find they end up being chased by developers, and potentially having embargoes issued against their home residences for property they don't even own yet!

It goes without saying that MRI have been known to blackmail clients into paying fees for things they thought they had already paid for as we covered in our furniture scam article a while back. Macanthony are well known in the industry for demanding their commissions at the point of deposit by the client, so they lose nothing by spreading rumours of developer bankruptcies, only to gain on the other side by flogging some heavily overpriced "bargain".

Oh, and guess who builds these overpriced bargains? MRI Construction.

Now who would have thought that?

For the regular readers you will notice we haven't bothered with the usual disclaimer, readers should make of this as they will, and base their judgement on actual facts, and the risk they are prepared to endure. (as opposed to go to a dog and pony show seminar and be pressured into spending more money)

As for rumours and libel? Well, We are not suggesting that any developer is in financial trouble, nor are we trying to manipulate the forums we can't control, or threatening people that say nasty things with huge lawsuits.

If you have an opinion about this situation, or any other that we write about, please feel free to comment on the relevant post. We do read them all, but please do not post personal details or insults, we cannot publish them.


More of the same, Bulgaria this time, apparently again, another string of clients has been told their constructor has gone under, and that investing in a shiner yet strangely more expensive property on the other side of the country is a far better bargain.

If you are reading this though a feed reader or on another site and would like regular updates as they happen, click here to get to our Investment Property Rumour home page, look for the feedburner box on the right hand side of the page, enter your e-mail and confirm and then with the appliance of science you will receive updates by e-mail as we publish!

To see a very active forum about Vila Verde and other developments in the region, go to CaboVerde24.com

To see info about Tecnicil, pop along to their blog, Vilaverde-Resort


CoachingByPeter said...

Buying real estate bargain properties can be a great way to make a large profit. If you take the time to do your research and select the property carefully, you can make a great deal of money.

moparftw said...

By the way, Tecnicil are not honouring their side of the contract on late delivery!!