Foreigners – including South Africans wanting to acquire freedom of movement for themselves and their families to study, work and live anywhere in the European Union – are increasingly turning to Portugal to acquire EU citizenship, says Chris Immelman, MD of Pam Golding International.
“The benefits offered via Portugal’s Golden Visa Programme, with its Schengen Visa and Portuguese residency, have suddenly became considerably more accessible with the introduction by the Portuguese government of a new category, which lowers the entry level from a €500 000 investment in real estate to €350 000 – in special circumstances.”
Since the Golden Visa Programme was introduced in October 2015 and up to June 2017, close to 200 South African investors have acquired residence permits, investing a minimum of €500 000 in residential property in prime locations mainly in the vibrant capital city of Lisbon, Immelman said.
Now, Portugal has taken its appeal up a notch by lowering the threshold entry level by allowing developers to approach government in order to renovate buildings of at least 30 years in historically significant centres or locations which are earmarked as urban regeneration areas.
These refurbished units can then be sold for a minimum of €350 000 to foreign investors, who then enjoy all the advantages of visa-free travel in all 26 countries in the Schengen area, plus the ability to apply for EU citizenship ,which then affords them the ability to live and work in any of the EU countries.
“Following the announcement of this new opportunity we have been searching far and wide for a development that not only meets these criteria, but which also stacks up against our stringent due diligence for such a project being undertaken by reputable, experienced developers. We have recently identified an exceptional development which consists of an existing apartment building that is being converted into a hotel and is situated in Porto, Portugal’s second largest city which is located on the coast in the north of the country,” said Immelman.
“Through Pam Golding Properties’ global network and international connections, we met two successful overseas business executives who introduced us to their third partner, Jerry Morgan of the international Mercan Group, which is involved in a number of developments in Portugal and has been responsible for almost 40 successful EB-5 US Visa (Green Card) investment programmes in the USA with a total capital value of over US$250 million alone.
“The development project they are bringing to market is Sé Catedral Hotel, a qualified real estate restoration of an old building in the historic centre of Porto and Heritage Site conversion into a boutique hotel of 50 rooms on five floors, with amenities such as a restaurant-bar and terrace cafe.
“With views over the Porto Cathedral and nearby city icon, Dom Luis Bridge, a famous tourist attraction, the hotel suites will each be sold to individual buyers for €350 000. This is essentially a buy back scheme, where owners will enter into an agreement with the developers to ultimately sell the units back to the developers who will run it as a hotel. On payment of the sum of €350 000, and upon completion of the development, owners will receive a guaranteed gross return of 4% for a five year period, after which the unit will be handed back to the developer and the owner receives his/her full purchase price back.”
Immelman said that although the owner does not benefit from any capital appreciation of the unit, his/her downside is fully protected. “This means you are able to acquire EU citizenship without it costing you anything, as the 4% rental guarantee will pay for all the government and professional fees while your initial investment of €350 000 is returned to you. Owners enjoy seven days’ free accommodation per year and can acquire their new citizenship after six years.
“For South Africans this is a highly appealing and affordable opportunity – it’s a hassle-free arrangement with guaranteed buy back and easily accessible.”
With 220 days of sun each year, a flourishing tourism industry and shortage of hotels, further boosting the demand for such accommodation, Portugal offers residents free quality health care and excellent education facilities – with more than 300 higher education institutions, Pam Golding said.