Turkey Real-Estate Direct and the Orient Palace

FAQ on Orient Palace

Bodrum Orient Palace - Our clients’ most frequent

1. What does the Euroholding statement mean?

Essentially, our view is that this statement is an offer of tangible assets (land and property) as collateral/security against client payments and rental owed to date. In principle if implemented successfully it would essentially provide a form of security for investors’ money paid to date. In practice implementation will not be straightforward as both Euroholding and the clients’ representatives will have to agree a detailed solution.
Example:

• If a client has so far paid €100,000 for their property, they are now owed €10,000 in rent as of 15th Nov 2007.
• Euroholding is offering assets to the equivalent value of €110,000 to this client as security to the client until they conclude partnership negotiations.
• Euroholding also stated that once partnership negotiations are concluded, the money will be released to the project with the first payment being the rental. The rest of the money will cover the cost of completion of the project. At this point the clients’ charge on Euroholding’s assets is removed.
• This suggested solution must be implemented in a way that does not hamper partnership negotiations.
• The clients will require an independent valuer and a Turkish legal representative to implement this solution.
• During the Agent-developer negotiations, Euroholding/Unifin restated their intention to both pay the rent and complete the project.

2. What are the next steps?

• The agents will facilitate a clients meeting so that clients can set the agenda and elect a representative committee. Details for this meeting are currently being worked out.
• The agents will help facilitate a meeting between the developers and the clients’ representatives at the earliest opportunity.
• The agents will act in an advisory role to the clients’ representative committee and their legal advisor in an effort to bring about a swift solution.

3.Are the Agents now distancing themselves from this project?

Absolutely not! We felt it important to address this question as some clients have expressed this concern.

The agents will continue to do everything within their power & remit to help their clients. It is important to point out that the agents are inherently limited in their capacity as sales agents. The clients’ best interests take first priority in every agent’s book, over and above their own!

• The agents mobilized themselves immediately to travel out to Germany & Holland to meet with the developers the moment they found out that the rental payment was not going to be made on 15th November. They came back with a proposal from the developers that the clients must evaluate and decide upon.
• From the information that we have been able to obtain, it is our commercial opinion that this project is still a viable project for a number of reasons, not least of which is the representation by the developer that they have substantial assets. It is very important however for all information provided to be independently verified by clients’ representatives and that the clients receive full independent legal and professional advice before making their own decisions.
• The agents can not take the power to decide away from their clients, so they are limited to facilitating the clients and informing them so that as a group they can make the best informed decisions!
• The agents do not have the ability or financial capacity to pay the rental or complete the construction. That is the role of the developer.

4. Can I get my money back?

Euroholding state that any money sent out to the project so far has been spent on construction and that 40% of the work onsite is complete. Euroholding stated that they wish to complete the site with the new partnering company and therefore they do not wish to cancel any purchase contracts. Euroholding also stated that their proposed client payment insurance/security solution will insure all clients for their payments to date. As sales agent we asked Euroholding how clients should proceed with a request for a refund. Euroholding have advised that clients make their refund request in writing. It is also important for all clients to realize that every party has an interest in seeing this project succeed. It is clear that contractual deadlines have been missed which is a concern. .However, unless purchasers can agree as a whole to allow the developer more time, this project could become mired in a series of legal disputes which could set back progress even further.

5. Is my money in the notary safe?

We have been advised that any money lodged in the Dutch notary account should still be there unless specified conditions for release of funds were met. Furthermore, our understanding of the notary system in Holland is that notary accounts are bonded, much like Irish solicitor client accounts.

Notary contact details:
Phone 0031 26 4425321 Contact Name: Ms. Chantelle Duis

Ms. Duis’ email: c.duis@notarispoort.nl
General Email: notaris@poort.knb.nl
Notary Name: Mr. P.A.J. Poort Derdengelden

6. Are the bank guarantees valid?

Bank guarantee documents are private contracts between a client and the bank. We have no legal right to query this private agreement with the bank in question. We ask our clients to contact the bank in question directly and verify the nature of the bank guarantee.

It is important to note that the bank guarantees are only valid under the following conditions:

• 1. Only clients who have paid 100% for their property could apply for a bank guarantee in the first instance.
• 2. Only those clients who could apply and indeed did apply could have received a bank guarantee.
• 3. The information relayed to us is that approximately 40% to 50% of those clients who applied for the bank guarantee actually received paperwork from the bank
• 4. Only those clients who have received the bank guarantee can request the money from the bank
• 5. All other applicant clients who did not receive their bank guarantee documentation must enquire with Unifin Groep as to the status of their application (info@unifingroep.nl).

It is important for a client to understand that any bank guarantee issued by a bank is a private contract between the client and the bank. Your Agent has no visibility over this legal document, and their only role in some cases may have been helping collate application documentation for passing on to Unifin for processing. The bank along with Unifin processed and issued the bank guarantee, not the Agent. Drawing down on the bank guarantee – the bank guarantee document has contact details at the base of the document for a client to request their rental figure in writing.

7. Is the rental payment going to be paid?

Euroholding have maintained in all their communications to date that they remain committed to paying this rent. They have not committed to a date at this point but have included the rental figure in the proposed asset security/insurance solution.

8. Why do I not have my title deeds?

Title deeds are applied for by the developer with military permission applications and the title deeds (Tapu) offices. Your sales agent has not played a part in this tapu application process as they were instructed that the Euroholding Turkish staff would be responsible for this task. Your agent may be instructed as your power of attorney (POA) to act on your behalf to collect tapus in batches from Turkey in person. Currently approximately 15% to 20% of the Irish agents’ clients’ titles have been processed and passed to the clients. All other enquiries must be directed to Unifin and/or Euroholding.

9. What is going on with partnership negotiations?

Euroholding recognize that this project is well behind schedule and they have admitted that their original plan to have the project self-sustaining through sales is not succeeding. Euroholding stated that this is due to multiple reasons such as the fact that much of the clients’ payments are still in the notary accounts, many of the clients payments are still outstanding etc.Euroholding also stated that while they had assets far in excess of the value of the cost to complete Bodrum Orient Palace, they wished to reach a swift conclusion with a cash rich partnering company rather than waiting to sell some assets. In the meantime, Euroholding proposes that they offer the clients security for their money paid so far in the form of assets to the same value. The Agents were presented with documents in relation to ongoing partnership negotiations. These documents were not independently verified and remain confidential. The clients’ legal advisors should request evidence of negotiations.

10. Why is Euroholding statement not posted on their website?

Euroholding’s statement was posted on their website at the following address on Wednesday 21st November - http://www.euroholding.com.tr/english.htm

11. Can my agent guarantee the developer will pay the rent, complete partnership negotiations shortly etc.?

No party will guarantee the actions or words of any third party in business. Your agent can only guarantee what tasks or work they themselves can achieve within the limit of their capacity e.g. no agent has the ability to conduct the transfer of from a different company’s private business bank accounts.

12. Why has Euroholding suggested that they meet with the clients’ selected/elected representatives and not all the clients?

Euroholding stated that they wished to have every chance of a productive meeting with a tangible solution at its conclusion. However they believe that it would not be possible to conduct such a meeting with hundreds of clients. A more sensible and fruitful approach, they believe would be to meet with the clients’ selected/elected representatives. They have requested that the clients appoint five representatives with one chairperson and their legal representative(s).

13. How long will this proposed solution take to implement?

The timeframe for a solution is dependent on the progress of the negotiations between client representatives and Euroholding. In parallel Euroholding informed the agents that the negotiations are ongoing with potential partners and one has signed a letter of intent. There is no firm timeframe available.

14. Who will be the clients’ legal representative?

It is strongly advised that the clients appoint an Irish legal representative and possibly a Turkish legal representative. The client legal representative needs to work with Euroholding on the ground in Turkey on many facets of the solution and then be in a position to communicate them effectively to the clients appointed representatives.

15. What will my Agent’s role be in providing a solution?

Your Agent is legally restricted to act as a facilitator in the provision of any solution. This is logical as (a) the developer is responsible for the completion of the project & (b) the next steps must be a collective decision by the clients. The agents can not make any decision on behalf of the clients or the developer.

Yours sincerely,
Turkish Real Estate Direct, Astute Property International & Remax Tralee Disclaimer: This document is provided for guideline only in our capacity as sales agents. We have no authority to bind Euroholding or Unifin Groep. No content can be interpreted in any form as part of a legally binding document. Clients are advised to independently verify all information provided and to seek independent legal and financial advice where necessary.