Aug 2010: Super-Profits in Super-Prime for Saigol DDC
Super-prime London developer Saigol DDC’s profits stand out in a time when others are struggling. Saigol DDC’s returns to investors from 2005-2008 were 150% per annum. Since 2008 and the onset of the credit crunch culminating in the demise of Lehman, Saigol DDC has returned 50% to investors. This is a remarkable achievement as Saigol DDC has achieved every fund’s goal of making more money than others in the good times and making even more money in the bad times.
Saigol DDC‘s success in making profits through the crunch is remarkable given the comparisons. The FTSE has slumped over the same period, private equity funds have struggled and even the best hedge funds have had a torrid time managing the challenges of the credit crunch. Even looking at other property comparisons, Saigol DDC’s results are impressive. For example, Knight Frank’s Prime Central London Index, the leading index focused only on sales in the best postcodes in prime London, dropped 20% during the crunch.
So how has Saigol DDC managed to produce results that others have not been able to? The Founder and CEO, Faisal Saigol says, “Our success is built on a fantastic team and strong investment discipline. We never forgot the fact that markets make you overpay in good times and are happy for you to underpay in bad times. At the peak of the market, we therefore stuck to our guns in making decisions based on the merits of the deals in front of us and were happy to let others chase deals that we felt were overpriced. We only closed deals that gave us a margin of safety.”
That sounds like a simple enough formula, but is hard for investors to stick to when they feel pressured to do deals. Faisal goes on to say, “Not doing a bad deal is often better than doing a great deal.” Sounds simple enough, but I am sure many other investors are wishing they had heeded such homespun advice.
Saigol DDC is one of the leading investors in and largest developers of super-luxury properties in London.
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