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Harmony | Knownledge base

Risks

Like any investment, investing with Harmony comes with risks.

These risks include:

The acquisition, management, and sale of real estate assets are subject to uncertainties such as market fluctuations related to supply and demand. This business is also subject to variations in construction costs, which may be due to rising prices of raw materials and/or labor. Moreover, the profitability of this activity depends on decisions made regarding the acquired real estate assets. Furthermore, the Issuer may face difficulties in finding tenants, which could lead to a vacancy risk, potentially compounded by a risk of non-payment of rent. The actual rental yield could therefore be lower than initial estimates, or even null. Additionally, the Issuer might have misestimated future expenses (e.g., significant increases in taxes and non-reimbursable charges), which would reduce the profitability of real estate projects.

The yield on the Bonds relies exclusively on the net income generated by the Underlying Property, after expenses. It is possible that the income could be low or even null over prolonged periods due to, for instance, renovations, vacancies, non-payments, or administrative measures affecting rental amounts. Due to the risks associated with income from the Underlying Property, the actual yield on the Bonds may be lower than initial estimates or null.

The yield on the Bonds relies on the net income generated by the Underlying Property, after deducting the expenses borne by the Issuer due to the Underlying Property. These expenses could be higher than expected due to unforeseen or exceptional circumstances (e.g., significant increases in taxes and non-reimbursable charges, major repairs, etc.). Due to the risks associated with the expenses of the Underlying Property, the actual yield on the Bonds could be lower than initial estimates or null.

Before the bond issuance, the Issuer has sufficient net working capital to meet its obligations and cash flow needs for the next twelve (12) months. Financing sources under consideration for the following six (6) months include the issuance of new bonds. However, the Issuer’s future activities could ultimately negatively impact its financial situation.

Risk of Illiquidity of the Bonds

As the Bonds have not been and will not be admitted for trading on a regulated or organized market, their sale is not guaranteed. In the absence of a buyer, bondholders may not be able to recover all or part of the capital invested in the Bonds before the Maturity Date.

Bondholders will be creditors of the Issuer and, as such, will not have any political rights regarding the Issuer’s management. Thus, management decisions made by the Issuer’s bodies may be unfavorable to bondholders. However, in accordance with Article L. 228-46 of the French Commercial Code, bondholders will be automatically grouped into a Bondholders’ Representative Body, endowed with legal personality, to ensure their collective representation vis-à-vis the Issuer. We have implemented measures to reduce the risks associated with this investment, including the establishment of a security interest: a mortgage; and the introduction of liquidity clauses.