20 Questions to Ask a Project Operator at the First Meeting

Before a first meeting with a property project operator, prepare twenty questions in five groups: goal and term, project and contractors, money and model, control and reporting, risks and evidence. This is not statistics on enquiries but a list of what is worth finding out before signing. Where DNPI Capital has a public answer, it is given beside the question. The terms of a specific project are always set by the contract.

What do you ask about goal, capital and term?

1. What result do you need, and by when? Capital growth through a project, income or preservation: the answer determines the direction and the format of participation.
2. How much are you putting into one project? At DNPI Capital, residential and commercial property and land start from 1 M€, hotel projects from 3 M€ and apartment buildings from 10 M€.
3. For how long will the money be out of your hands? Every project has its own term. In the Sitges project it was two years.
4. How many decisions do you want to take yourself? This determines how much you need control and investor rights.

What do you ask about the project and contractors?

1. Which direction fits the goal, and why? DNPI Capital has five: residential property, commercial property, land, hotel projects and apartment buildings. The company works only in Barcelona and its suburbs.
2. What does the full cycle consist of? Sourcing the property, calculating the economics, purchase, legal support, renovation or development, sale.
3. Who does the renovation and construction? BCNYARD, SLU: an independent construction company, a contractor under contract.
4. Does the operator put in its own money? DNPI Capital invests its own capital in projects. The size of its stake in a specific project should be clarified before signing.
5. Where do the properties come from? The company has its own off-market database.

What do you ask about money and DNPI's fee?

1. What is DNPI's fee? In the DNPI Capital model the fee is 50% of project profit and the other half stays with the investor: how it works.
2. What is deducted before distribution? The contract sets the list of expenses: see what is included in project expenses.
3. What is the contractual 10%? If the investor's return over the whole project after distribution is below 10%, DNPI Capital pays a compensation out of its own fee. This is a return per project, not an annual one; the terms and the calculation base are written in the contract for the specific project. It is not a guarantee of capital. Breakdown: 10% compensation.
4. Which taxes and costs sit outside the calculation? Taxes, financing, paperwork and other costs need to be requested separately before you compare projects. For example, ITP (transfer tax) in Catalonia on resale housing is 10–13% (ATC).
5. How do you exit before the end of the project? This is a matter for the contract: investor exit from a project.
6. Who owns the property, and in whose name is the purchase made? An individual or an SL (limited company): a question for an asesor fiscal (tax adviser) and an abogado (lawyer) before signing.

What do you ask about control and reporting?

1. What do I see while the project is running? The investor gets a digital dashboard with the budget and the status of the works.
2. How is a change to the budget approved? Ask for the procedure in writing: renovation budget control.
3. Which documents will I receive before signing, and when? Ask for the draft contract in advance so that you can show it to a lawyer.

What do you ask about risks and evidence?

1. What can go wrong, and what then happens to my money? The operator should name the risks itself; check its answer against the risk map.
2. Which completed projects can I check? DNPI Capital has two.

Which two projects can be checked?

Sitges: a plot bought for €509,250, permits and licences €20,000, sold with the licence for €760,000, term two years, difference before other costs €230,750. Compte de Urgel in Barcelona: a flat bought for €410,000, renovation €76,230, sold for €720,000, difference before other costs €233,770.

The difference here is the sale price minus the purchase price and the costs listed. Taxes, financing, paperwork and other costs are not included; it is not net profit and not the investor's return. Past results do not guarantee future ones. Project pages: Sitges and Compte de Urgel.

How do you use the list before the meeting?

You do not need to ask all twenty questions in one meeting. Take the five where the answer matters most to you and ask for the rest in writing. You can make a first calculation on your own assumptions in the investor calculator, and you can contact the team through the contacts page.