What makes Al-Falaah Properties unique?
Unlike other conventional investments, we work uniquely in the following way:
We locate a property of worth, which we assume to give great returns. We then send it out to investors to fund it. Once the money is received, we pay cash (which cause us to get a discount in many instances). We then immediately purchase the property from the investors. In a way that the investors get 10% per annum. The benefits which the investor gets in this over other investments are:
1) Income is guaranteed. Irrespective whether there are tenants or not. Since we bought the property, we are legally bound to pay you as per the contract, even if the property lies empty for the entire duration
2) There are absolutely no risks. Since we bought it, in the unlikable event of any calamity befalling (fire etc), we will loose out, and the investor will still get his returns,
3) The investor is secure without having to resort to issues which are haraam or debatable amongst Ulama (insurance, takaful etc),
4) Ideal to evade tax
What security does the investor have that he will be paid?
He can hold the title deeds, or if there are more than one investor, they can agree amongst themselves,
If an investor does not want to sell immediately, can he remain as a partner?
Yes, sure. In this way he will benefit from the capital growth of the property. Thus, in the second year he will earn more, then it will increase in the third year and so forth. However, since he is becoming a partner:
1) The Islamic laws of partnership will apply. Thus, all partners will share in profit and loss. Thus, it is slightly more riskier, however, this risk is further mitigated by the fact that we make adequate research to ensure there are reliable tenants, and they have a contract in place.
2) We will follow the South African law and only take a maximum of 20 partners per project. Hence, these 20 investors will have to over the entire cost of the property. The property shall be registered in the name of the specific investors who have elected to be partners in the particular project.
In this case of the Capital Growth Investment, the partnership shall be liable for all expenses related to the property, such as conveying fees, transfer duty, maintenance of property, etc
Furthermore, the partnership shall be liable for:-
a. all of the reasonable expenses incurred in the establishment of the partnership including but not limited to legal, accountancy, printing, postage and other direct costs of establishment;
b. all expenses properly incurred in relation to the ongoing business and administration of the partnership including, without limitation, legal fees, auditors' fees and litigation costs.
c. all transaction and potential transaction related expenses including, without limitation, advisory costs, stamp duty;
d. all investment holding costs, including the costs of custodians or nominees;
e. any taxes, fees or other charges (including VAT) imposed on the partnership by any governmental authority (whether within or outside of South Africa);
f. costs and expenses payable in connection with the dissolution and liquidation of the partnership;
