Hi,

I am new to this forum and wanted to get other views on the subject of bank gurantees. We reserved a villa with Property Logic on the Le Jardin De Fleur (VVT6 plot) in Sadia and it now comes the time to pay first 20% deposit with the next 20% due early 2008.

Our biggest concern is that unlike Fadesa , Property Logic will not provide any bank gurantees - my Moroccon solicitor has tried in vain to get this for me and he has advised this is very unusual. Thus we could lose 40% which is not a small sum given the avg villa is £250K!!

Checked out property logic website but its basically 3 guys (English/Dutch/Estonian) who formed the company in 2005 so this isn't very re-assuring at all as they could go bust by 2009/2010 when VVT6 is due to complete.They have also now ventured into the Brazil market.

Was wondering if anyone had any further info on Property Logic and if there are any insurance type products that you can buy to protect the 40% paid in case Property Logic default.

Thanks in advance.

There are no guarantees but we felt that the fact that as property logic have a substantial number of plots in Saidia, coupled with the fact that it's the flagship for the 6 Azur Plan developments which is being supervised by the King and that in itself provided some kind of reassurance.

There is an owners group for le jardin de fleur set up by a purchaser which provides an added safety net should any lobbying prove necessary. The Gruop is currently establishing links with Moroccan officials. You can make contact with the coordinator, Popcorn, through a PM here or via the saidia forum.

Amoflaherty, guarantees are possible but cost money and, ultimately, you would bear this cost by paying a higher price for your property. Given that so many properties have been sold without guarantees, to introduce one now would be too complicated. As an individual, I don't think you can get a guarantee and, even if you did, the cost would be multiples of the cost that PL might pay (due to many economies of scale and types of diversification). Alternatively, you might want to think about the most likely events that would put your money at risk and hedge against those. That is what a guarantor would be doing. For example, PL will almost certainly be successful if the resort is successful but can not succeed if the resort fails. If the resort fails, Fadesa will be hit badly and as they are a listed company, you might want to short their share price. But remember, like guarantees, if your investment is then successful, any costs you have incurred in protecting yourself will be lost and your loss is not well corrrelated to a fall in the Fadesa share price.