# Loftly Token-Key Buyer Financial Model

*Last Updated: January 2026*

## Investment Overview

A Token-Key represents fractional ownership (1/12 to 1/8) in a premium Spanish wellness villa held through a dedicated Spanish SL (Sociedad Limitada).

| Parameter | Value | Notes |
|-----------|-------|-------|
| Token-Key Price (1/12 share) | €125,000 – €150,000 | 4+ weeks/year |
| Token-Key Price (1/8 share) | €185,000 – €225,000 | 6+ weeks/year |
| Property Value Range | €1.5M – €2.0M | Post-renovation |
| Ownership Fraction | 8.3% – 12.5% (1/12 to 1/8) | |
| Annual Usage Rights | 4–8 weeks | Based on fraction size |
| Investment Horizon | 5 years (typical) | |

### How Ownership Works

Each property is divided into Token-Keys sold to owners, with Loftly retaining any unsold shares. A typical property structure:

| Component | Example Allocation | Notes |
|-----------|-------------------|-------|
| Owner shares sold | 62.5% (e.g., 3×1/8 + 3×1/12) | Variable mix per property |
| Loftly-retained shares | 37.5% | Loftly earns full rental income on retained shares |
| Total | 100% | |

**Key point:** Loftly retains unsold shares and earns rental income from them. This aligns Loftly's interests with property performance.

---

## Market Data & Sources

### Property Appreciation (Costa Blanca)

| Timeframe | Appreciation | Source |
|-----------|--------------|--------|
| 2025 Actual | 14.8% YoY | [Casa Rica Estate](https://www.casaricaestate.com/en/blog/costa-blanca-property-investment-guide-2025-2026) |
| 2026 Forecast (General) | 5–9% | [Investropa](https://investropa.com/blogs/news/costa-blanca-price-forecasts) |
| 2026 Forecast (Premium) | 10–12% | [Casa Rica Estate](https://www.casaricaestate.com/en/blog/costa-blanca-property-investment-guide-2025-2026) |

**For projections, we use:**
| Scenario | Annual Appreciation | Basis |
|----------|---------------------|-------|
| Conservative | 2% | Below market forecast |
| Base Case | 5–7% | Mid-range forecast |
| Optimistic | 10–12% | Premium location premium |

### Short-Term Rental Performance (Airbnb/STR)

| Metric | Value | Source |
|--------|-------|--------|
| Gross Yield (Luxury Villas) | 6–10% | [Blanca Stay](https://blancastay.com/best-roi-airbnb-costa-blanca/) |
| Premium Villa Yield (Calpe, Dénia) | 9–11% | [Casa Rica Estate](https://www.casaricaestate.com/blog/villa-investment-returns-costa-blanca-market-analysis-2025) |
| Average Occupancy | 55–65% | [Investropa](https://investropa.com/blogs/news/costa-blanca-airbnb) |
| Top Performer Occupancy | 70–80% | [Investropa](https://investropa.com/blogs/news/costa-blanca-airbnb) |
| Average Daily Rate (Standard) | €90–€160 | [Investropa](https://investropa.com/blogs/news/costa-blanca-airbnb) |
| ADR (Premium Wellness Villa) | €500-700 | [ChicVillas](https://www.chicvillas.com/en/villas/spain/costa-blanca)/[Villanovo](https://www.villanovo.com/en/spain/costa-blanca) premium segment |

### Total Return Benchmarks

| Property Type | Combined Annual Return | Source |
|---------------|------------------------|--------|
| Luxury Villas (Strong Locations) | 11–21% | [Casa Rica Estate](https://www.casaricaestate.com/blog/villa-investment-returns-costa-blanca-market-analysis-2025) |
| Conservative Blended Estimate | 14–16% | [Casa Rica Estate](https://www.casaricaestate.com/en/blog/luxury-villas-costa-blanca-2025-2026-buyers-guide) |

---

## Assumptions

### Model Property Profile

| Attribute | Value |
|-----------|-------|
| Purchase Price | €700,000 |
| Renovation | €280,000 |
| Post-Renovation Value | €1,500,000 |
| Token-Keys Issued | 6–8 |
| Token-Key Price | €150,000 (average) |

### Annual Operating Costs (Per 1/8 Share)

| Cost Category | Annual Amount | Notes |
|---------------|---------------|-------|
| Property Management | €1,200 | Professional management |
| Maintenance Reserve | €500 | ~0.5% of property value / 8 |
| Insurance | €250 | Building + contents / 8 |
| IBI (Property Tax) | €400 | ~€3,200 total / 8 |
| Community Fees | €150 | If applicable |
| Utilities Reserve | €250 | Base costs when vacant |
| **Total Annual Costs** | **€2,750** | |

*For 1/12 shares, costs are proportionally lower (~€1,850/year).*

### Rental Income Model

When Token-Key owners are not using the property, it can be rented to generate income. The property generates rental income from two sources:

1. **Owner rental days** — When owners rent out their allocated weeks (estimated 20-30% of allocation)
2. **Loftly-retained share rental** — Days from Loftly's retained shares (100% available for rental)

#### Year 1 vs Stabilized Performance

| Parameter | Year 1 (Ramp-up) | Year 2+ (Stabilized) | Notes |
|-----------|------------------|----------------------|-------|
| Occupancy Rate | 45-50% | 65% | Conservative long-term target |
| ADR | €450-550 | €500-700 | Builds reputation/reviews |
| Estimated rental nights | ~80-90 | ~117 | On available nights |

#### Owner Rental Income (When Renting Your Weeks)

**Example: 1/8 share owner rents their entire 6-week (42 night) allocation:**

| Line Item | Year 1 (Conservative) | Year 2+ (Base Case) |
|-----------|----------------------|---------------------|
| Gross Rental (42 nights × ADR) | €18,900 (@ €450) | €25,200 (@ €600) |
| Loftly Management Fee (30%)¹ | -€5,670 | -€7,560 |
| **Service Charge (€50/day)²** | **-€2,100** | **-€2,100** |
| **Net to Owner** | **€11,130** | **€15,540** |
| Net Yield on €200k investment | 5.6% | 7.8% |

**More realistic scenario: 1/8 share owner uses 4 weeks, rents 2 weeks (14 nights):**

| Line Item | Year 2+ (Base Case) |
|-----------|---------------------|
| Gross Rental (14 nights × €600) | €8,400 |
| Loftly Management Fee (30%) | -€2,520 |
| **Service Charge (€50/day)** | **-€700** |
| **Net to Owner** | **€5,180** |
| Net Yield on €200k investment | 2.6% |

**Important:** Service charges are deducted from owner rental income, not paid separately.

¹ Full-service management includes guest communication, booking, cleaning, maintenance coordination, and compliance. ² €50/day service charge covers turnover cleaning, concierge, consumables, and supplies—charged on occupied nights only.

---

## 5-Year Cash Flow Projection

### Base Case: 7% Appreciation, €150,000 Token-Key

| Year | Property Value | Share Value (1/8) | Rental Income | Operating Costs | Net Cash Flow |
|------|----------------|-------------------|---------------|-----------------|---------------|
| 0 | €1,500,000 | €150,000 | — | — | -€150,000 |
| 1 | €1,605,000 | €160,500 | €2,340 | -€2,750 | -€410 |
| 2 | €1,717,350 | €171,735 | €2,504 | -€2,832 | -€328 |
| 3 | €1,837,565 | €183,756 | €2,679 | -€2,917 | -€238 |
| 4 | €1,966,194 | €196,619 | €2,867 | -€3,004 | -€137 |
| 5 | €2,103,828 | €210,383 | €3,068 | -€3,094 | -€26 |

### Exit at Year 5

| Component | Amount |
|-----------|--------|
| Initial Investment | -€150,000 |
| Total Operating Cash Flow (Years 1-5) | -€1,139 |
| Exit Value (Share of Property) | €210,383 |
| **Net Profit** | **€59,244** |
| **Total Return** | **39.5%** |
| **Annualized IRR** | **~7%** |

---

## Scenario Analysis

### Investment IRR by Appreciation Rate

| Scenario | Annual Appreciation | 5-Year Exit Value | Total Return | IRR |
|----------|---------------------|-------------------|--------------|-----|
| Conservative | 2% | €165,612 | 10% | 2.0% |
| Base Case | 5-7% | €191-210k | 28-40% | 5-7% |
| Optimistic | 10-12% | €242-264k | 61-76% | 10-12% |

### Adding Net Rental Yield (~2-4%)

| Scenario | Appreciation | Rental Yield | **Total IRR** |
|----------|--------------|--------------|---------------|
| Conservative | 2% | 2-3% | **5-6%** |
| Base Case | 5-7% | 3-4% | **8-11%** |
| Optimistic | 10-12% | 3-4% | **12-15%** |

**Note:** Net rental yield assumes partial rental of allocated weeks. Most owners use 60-80% of their allocation and rent the remainder.

---

## Comparison: Token-Key vs Traditional Vacations (5 Years)

| Approach | Total Cost | Residual Value | Net Position |
|----------|------------|----------------|--------------|
| Traditional Rentals (5 weeks/year) | €125,000+ | €0 | **-€125,000** |
| Token-Key Ownership | €163,889 | €210,383 | **+€46,494** |
| **Net Benefit of Token-Key** | | | **+€171,494** |

**Calculation:**
- Traditional: 5 weeks × €5,000/week × 5 years = €125,000 spent, nothing remaining
- Token-Key: €150,000 + €13,889 operating costs - €12,750 rental income = €151,139 net outlay → exit at €210,383

---

## Key Insights for Token-Key Buyers

### 1. Primary Value = Lifestyle Benefits
- Guaranteed 4–8 weeks/year in a premium wellness villa
- Wellness-focused design: clean air, pure water, natural materials
- Safe environment for children to swim, sail, connect with nature
- Multigenerational bonding in purpose-built spaces
- Professional management eliminates ownership hassle
- Personal storage means travel light

### 2. Secondary Value = Wealth Building
- Property appreciation: 2–12% annually in current market¹
- Net rental income: ~2–4% yield when partially renting allocated weeks²
- Spanish coastal real estate has historically outperformed
- Exit liquidity via resale or full property sale

### 3. Honest Assessment
- This is a **LIFESTYLE investment first**, financial investment second
- Pure investment IRR is **5–15%** depending on appreciation scenario
- Real value is in **lifestyle + appreciation combined**
- Compare to: €125,000+ spent on traditional vacations with **zero residual value**

### 4. Risk Factors to Consider
- **Property market risk:** Values can decrease as well as increase
- **Liquidity risk:** No established secondary market yet; exit depends on resale or full property sale
- **Currency risk:** EUR/USD fluctuations affect returns for non-EUR investors
- **STR regulatory risk:** Valencia region has tightening short-term rental regulations
- **Year 1 ramp-up:** Expect lower occupancy (45-50%) in first year as property builds reviews

---

## Cost Structure Breakdown

### Loftly Management Fee: 30%

Covers:
- Professional property management
- Guest services and concierge
- Maintenance coordination
- Booking and payment processing
- Quality assurance
- Inventory management

*Industry context: Full-service vacation rental management typically runs 25–40%; Loftly's 30% includes premium concierge services.*

### €50/Day Service Charge

Covers daily operating costs during rentals:
- Cleaning and turnover
- Personalization and welcome basket
- Concierge services
- Consumables and supplies

This fee structure supports a dedicated cleaner and concierge per 3–4 villa cluster.

---

## Data Sources & References

1. **Property Appreciation:**
   - Casa Rica Estate: [Costa Blanca Investment Guide 2025-2026](https://www.casaricaestate.com/en/blog/costa-blanca-property-investment-guide-2025-2026)
   - Investropa: [Costa Blanca Price Forecasts](https://investropa.com/blogs/news/costa-blanca-price-forecasts)
   - Idealista: [Quarterly Price Reports](https://www.idealista.com/sala-de-prensa/informes-precio-vivienda/)

2. **Rental Yields & Occupancy:**
   - Blanca Stay: [Best ROI Airbnb Costa Blanca](https://blancastay.com/best-roi-airbnb-costa-blanca/)
   - Investropa: [Costa Blanca Airbnb Analysis](https://investropa.com/blogs/news/costa-blanca-airbnb)
   - Casa Rica: [Villa Investment Returns](https://www.casaricaestate.com/blog/villa-investment-returns-costa-blanca-market-analysis-2025)

3. **Market Context:**
   - Tinsa IMIE Index: [tinsa.es](https://www.tinsa.es)
   - AirDNA MarketMinder: [airdna.co](https://www.airdna.co)
   - Global Wellness Institute: [globalwellnessinstitute.org](https://globalwellnessinstitute.org)

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## Disclaimers

- All projections are illustrative and based on current market assumptions
- Property values can decrease as well as increase
- Rental income is not guaranteed and depends on market conditions
- Operating costs may vary based on actual property expenses
- Past performance does not guarantee future results
- Consult financial and legal advisors before investing

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*Document Version: 2.0 | January 2026*