Investment Reviews
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Shojin: Romford
Updated:
Romford
This Shojin review is based on our latest investment on the platform, which involves a mixed-use development in Romford with annual returns of 17%. Read on as I discuss my experience with Shojin and thoughts on the platform in this investment review.
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Investment StatusOngoing
Projected Actual Return 29.75% Term 21 Months Maturity October 2024
Decoding Shojin: An Investor’s Perspective
I’ve been a fan of Shojin ever since I discovered the platform. While I typically enjoy introducing a slightly controversial element here to engage readers, Shojin, in my opinion, is the ‘gold standard’ of property investment platforms. Below is an independent Shojin review, evaluating key aspects against our investment scoring matrix.
Did the Shojin platform Payout when expected?
This investment with Shojin is ongoing. The payout from this investment relies on the developer to either sell or refinance the property to exit Shojin’s junior debt position and repay investors. Shojin will have the refinancing plan by July, a few months before the expected payout date. The latest updates point to the project running according to the program and budget, which is great considering everything that has happened within the UK economy over the last year.
Shojin seems to have a lot of involvement in the projects they feature with their Project Monitoring Surveyors (PMS), giving me a lot of confidence in their ability to deliver. Investors continue to accrue interest up until the point of exit, which is a nice touch. Based on this, Shojin currently scores 5 with regard to Payout.
This score is based on version 1 of our Matured Investment Review Matrix. Expand this section for a detailed breakdown of how this score was determined.
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0
No repayment has been made. Over 12 months have passed since the original projected maturity date, and no payment has been made. Amended maturity projections may have been made, but this score is based on the original projection.
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1
The payout was received 6 to 12 months later than originally projected, with no reason given for the delay. Additionally, amendments may have been made to the maturity date during this time without reasonable justification.
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2
Repayment was received 6 to 12 months later than originally projected. Amended maturity date projections were provided, along with reasonable justification for the delay with the project/investment.
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3
Repayment was made within 0 to 6 months after the originally projected maturity date, with no reason given for the delay. Amendments may have been made to the maturity date during this time without reasonable justification for the delay.
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4
The payout was received 0 to 6 months later than the originally projected maturity date. Updates were provided with reasonable justification for the delay.
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5
Repayment was made on time as per the originally projected maturity date. Bonus: repayment was made sooner than the originally projected maturity date.
Did the Shojin platform meet the projected Return?
For this project, Shojin offered various levels of interest based on the amount invested—up to 20% annually. Our projected return from this investment with Shojin was 29.75% over 21 months or an annualised return of 17%.
Investors in the Romford project benefited from a second charge over the property as well as a debenture over the project SPV company with rights ranking behind the senior lender. The developer also provided a substantial personal guarantee, an additional buffer. This is something that I think Shojin pushes for with all of their projects, since they invest alongside investors like you and me. It’s in their best interest that projects succeed.
While there have been some cost overruns, the developers’ contingency allowance has covered this. Shojin also provides a clear breakdown of the project capital stack in the investment documents. This breakdown also provides a return sensitivity table to show how investors’ returns and capital would be affected in various scenarios with decreased project GDV and an uplift in construction costs.
Shojin is keeping a close eye on the project with the instructed PMS, so I’m confident that the return target will be met, and their latest updates mirror this. Based on this, Shojin currently scores 5 regarding Return.
This score is based on version 1 of our Matured Investment Review Matrix. Expand this section for a detailed breakdown of how this score was determined.
The rating is determined by calculating the percentage of the actual return compared to the target return using the formula (((actual – projected) / projected) * 100). This percentage determines the rating, except for instances where the annualised return falls into specific ranges, even if the percentage difference is lower.
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0
This investment has resulted in a loss meaning the actual return is negative, either because no repayment has been made after 12 months with no reasonable justification given, or because the investment provider has released a statement regarding a total loss on this investment.
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1
Returns more than 45% below target. This rating is assigned if the actual return is significantly below the target return, but not enough to result in a loss. The initial funds are returned, or the annualised returns fall within the range of 0-10%.
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2
The actual return is moderately below the target return, falling between 30-45% under the target. This rating can also be given if the annualised returns are within the range of 10-12%, even if the percentage difference between the projected and actual return is greater.
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3
The actual return is below the target, but not as significantly as in rating 2, falling between 15-30% under the target. This rating can also be given if the annualised returns are within the range of 12-15%, even if the percentage difference between the projected and actual return is greater.
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4
The actual return is slightly below the target, falling between 0-15% under the target. This rating can also be given if the annualised returns are within the range of 15-17%, even if the percentage difference between the projected and actual return is greater.
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5
This rating is given if target return is met. This rating can also be given if the annualised returns are 17% or higher, even if the percentage difference between the projected and actual return is greater.
How good were the Shojin project Updates?
Updates from Shojin are excellent. Every quarter, I anticipate logging into my client area to find the latest project update. The updates offer comprehensive information to investors, including outstanding planning conditions, the latest construction progress with numerous images, economic updates, and a thorough breakdown of current project financials compared to the budget. This breakdown perfectly highlights the impact of changes such as senior debt interest rates. Shojin goes a step further by providing an explanation of any variances in financial comparison and who is affected by the change.
The team at Shojin also regularly hosts masterclasses and webinars designed to educate and inform investors about various relevant subjects, such as the UK housing market, tax, and investment options. These offerings provide significant value and are free to join.
Updates from the Shojin team hit the target dead center. They are among the best project updates I have received. Other investment providers should take note. Even though our money is locked into the project, whether it succeeds or fails, their updates almost instill a sense of control because you know exactly what’s happening. Based on all of this, I rate Shojin 5 in terms of Updates.
This score is based on version 1 of our Matured Investment Review Matrix. Expand this section for a detailed breakdown of how this score was determined.
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Radio silence, no updates were received throughout the entire investment period.
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1
Ad-hoc updates were received by request.
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2
Occasional updates were received via email. The updates were provided every 6 months to a year during the investment period.
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3
Regular updates were received every quarter or every 6 months and were emailed out to investors.
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4
Regular updates were received every quarter or every 6 months and were uploaded to a client area on the investment platform. These updates contained basic details such as progress updates, images, and key figures.
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5
Regular updates were received every quarter or every 6 months and were uploaded to a client area on the investment platform. These updates contained a high level of detail such as economic updates, financial projection breakdowns, and local market information.
What is the Shojin Platform like?
Shojin’s platform, developed by ShareIn, a direct investment platform also utilised by various investment providers in other sectors, features Shojin prominently at the top of their client list, and I’m not surprised – they’ve excelled.
The platform offers everything you could want. Your “My Shojin” client area displays your invested and cash balance, along with all your current investments on the platform, each with its own section housing key documentation and frequently updated project information in your investor portfolio.
Shojin previously had a secondary market on the platform, but regulatory changes have necessitated its removal for the time being. In its place, they’ve introduced an offline process to facilitate connections between buyers and sellers of units in their investments. This offers investor liquidity and reduces the barrier to entry for online real estate investing.
I’m rating Shojin a 5 in terms of Platform. It’s exceptional, and the masterclasses and webinars are worth signing up for even if you don’t plan to invest actively.
This score is based on version 1 of our Matured Investment Review Matrix. Expand this section for a detailed breakdown of how this score was determined.
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0
This provider did not have a platform or client area, making it very difficult to contact them throughout the investment period.
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1
While this provider did not have a platform or client area, a basic support line was fairly easy to contact throughout the investment period.
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2
While this provider did not have a platform or client area, they appointed a dedicated account manager to assist me with any queries I had throughout the investment period.
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3
The provider has a basic platform with a client area where basic project information is available. However, the information is limited to basic documentation and lacks updates.
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4
The provider offers an easy-to-use platform with a client area where users can find key documentation, as well as frequent project updates uploaded within a portfolio section.
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5
The provider offers an easy-to-use platform with a client area where key documentation and frequently updated project information can be found in your investor portfolio section. Additionally, the platform features an active secondary market.
Is Shojin Property Partners a good investment?
My experience with Shojin has been excellent, scoring a deserving 20, though this may change for an ongoing investment. I believe this score will remain as long as the team receives the refinancing plan from the developers on time.
- The investment with Shojin is ongoing, with payouts relying on the developer selling or refinancing the property to repay investors.
- Shojin demonstrates active involvement in projects through Project Monitoring Surveyors, enhancing investor confidence.
- Investors accrue interest until exit, with potential returns up to 20% annually for this project.
- Shojin pushes security measures for investors, including second charges, debentures, and personal guarantees from developers.
- Quarterly updates from Shojin offer detailed project progress, financial breakdowns, and educational resources.
- Shojin’s platform, developed by ShareIn, provides comprehensive investor tools, although the secondary market feature has been temporarily removed due to regulatory changes.
- Overall, Shojin receives high scores across categories like Payout, Return, Update, and Platform, reflecting its strong performance and investor-friendly approach.
The team at Shojin is doing an amazing job, and their focus on investor security, project monitoring, and co-investing alongside clients instils confidence. All that being said, this is an ongoing investment and things can always change. I look forward to seeing this one coming home and seeing what the future has in store for Shojin.
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