Garapua Beach Resort

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Garapua Beach Resort Brazil
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Agenda

• Welcome
• Brazilian Property market
• Location
• Oasis
• Resort facilities
• Investment features
• Purchase price comparables
• Rental comparables
• Rental projections
• Costs, fees tax

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• Brazilian property market

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• A Low Cost of Living.
• Caribbean climate without the price tag.
• Foreign Direct Investment (FDI) in Brazil is
  at a historic high.
• Buoyant Economic Prospects.
• A GDP of over 1 trillion recently upgraded
  to Investment Grade Country in 2007.
• Said to now have a million millionaires and
  more private jets than the USA.
• Growing Mortgage Housing Market.
• Increasingly wealthy middle class expected to
  increase by 66 in the next 10 years.
• Expected shortage of 10 million homes.
• No Restrictions on Foreign Ownership.
• Stable Democracy.
• The Tourist Boom.
• Since 2005, annual tourist arrivals have risen
  by nearly 100.

Source HVS Brazilian hotel market overview
http//pt.hvs.com
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• 9th largest economy in the world.
• Emerging property market.
• Tourism is one the fastest growing industries in
  Brazil growth of over 20 last year.
• Although the vast majority of tourism is still
  home grown, now international arrivals are
  increasing significantly.
• There is a huge demand for tourist accommodation.
• Foreign investment is booming as no restrictions
  to foreign ownership.
• Inward investments actively encouraged by
  government.
• Government. Brazil is also hosting the 2014 World
  Cup compulsory FIFA standards for
  infrastructure hotel standards.
• Brazil is bidding for 2016 Olympic Games.

Source HVS Brazilian hotel market overview
http//pt.hvs.com
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• Bahia is the strongest economy of the Northeast,
  responsible for more than 30 of the regions
  GDP.
• Since 1996, the state has shown constant economic
  growth, at levels outperforming Brazil as a
  whole.
• Salvador International Airport welcomed 6
  million passengers transported in 2008 and is one
  of brazils busiest airports.
• Between 1974 and 2008, the number of hotel rooms
  in Salvador grew 5 per year, on average.
• Between 2004 and 2007, more than 15 hotels were
  opened in the area.
• Between 2009 and 2012, five new hotels have
  announced developments
• Pestana Bahia Lodge.
• Caesar Business.
• Hilton,
• Ibis.
• Mercure Boulevard.
• Salvador is likely to be a host city for the 2014
  world cup.
• NB FIFA regulations require standards of hotel
  services infrastructure.

Source HVS Brazilian hotel market overview
http//pt.hvs.com
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Source HVS Brazilian hotel market overview
http//pt.hvs.com
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Source HVS Brazilian hotel market overview
http//pt.hvs.com
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• Location

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• North East Brazil considered the growth hot
  spot
• 26 states, Harlequin are building in Bahia
• North East Atlantic Coast
• Near Salvador 3rd largest city first colonial
  capital
• Considered one of the most glamorous Cities
• Tropical climate yet historically free from
  terrorism, hurricanes, tsunamis and
  earthquakes.

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• Best beaches in Brazil
• Area is famous for annual Carnival 2m people
• Island location Ilha de Tinhare
• Access by private plane
• 14 hours from the UK
• Official language Portuguese

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Local tourist attractions

• Pelourinho, the colonial district of Salvador,
  World Heritage site
• Encanto The Enchantment Beach with its deep
  ocean pools
• Turtle Conservation area in Praia do Forte.
• Whale watching on the migration route to
  Albrolhos
• Watch the 5 day Carnival in Salvador
• Eco-tourism center, some of the best diving and
  wildlife in the area
• Surf in Bahia

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• Oasis

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Oasis

• Ongoing negotiations with Oasis Hotels Resorts
  as management agent
• Land sourced in conjunction with Oasis
• Already run hotels in Brazil and the Caribbean
• Air Europa already flies in to Salvador

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• 50 hotels in 22 destinations worldwide
• over 14,000 rooms.
• Up to 96 occupancy (Dominican Republic)
• A growing business
• 2008/9 are planning opening 20 new hotels
• Air Europa ordered 9 new planes c. 90m each

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• Policy of corporate social responsibility and
  sustainable tourism.
• The Rainforest Alliance is linked to the United
  Nations Environment.
• Charitable foundation child development centre.
• Their hotel in Puerto Plata a has won Eco-awards

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• Facilities

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• Intending to create a 5 star luxury spa resort
• 1,700 acres of land,Intention to increase to 3500
  acres
• In negotiations with
• Gary Player signature golf course
• Pat Cash tennis academy
• Trader Vics restaurant
• Senor Pico and Mai Tai lounge
• Equestrian polo academy

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CGI of Gary Player hotel facilities
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CGI of Gary Player hotel facilities
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• Investment features

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• Up to 50 under market value
• 10 rental guarantee for 2 years
• 50 net room rate share
• Luxury furniture pack included
• Regular refurbishment
• 100 finance available subject to status
• End mortgage
• 30 days free usage (unless buying through a SIPP)
  
• SIPP approval pending

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Land Opportunity

• Option to build a property within 5 years of
  receipt of title to land.
• Selection of property designs available
  option to customise
• Management maintenance available from hotel
  operator
• Optional rental pool

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Prices

• 450 sq m 30,000
• 600 sq m 40,000
• 750 sq m 50,000
• 900 sq m 60,000
• 1050 sq m 70,000
• The price of each plot includes connection to
  electricity, water, drainage and roads.

Prices correct as of 24th May 2009
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Prices From

• 350 sqft studio 50,000
• 460 sqft studio suites 70,000
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• 827 sqft 1 bed 100,000
• 1134 sqft 2 bed
  125,000
• 1131 sqft 2 bed 150,000

Prices correct as of 24th May 2009
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Prices

• 1 bed detached villa 175,000
• 2 bed Bali villa beach front 295,000
• Detached plantation villas 340,000
• Island spa villas 400,000

Prices correct as of 24th May 2009
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• Price comparables

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Apartments
Studio Garapua Beach Resort 50,000 Lagoa
Pearl 69,999 (advertising 20 below
market) One bed Garapua Beach Resort
70,000 Lagoa Pearl 105,999 (advertising 20
below market) Natal Ocean Club
138,000 Two bed Garapua Beach Resort
125,000 Lagoa
Pearl 141,499 (advertising 20 below
market) Natal ocean club 278,000

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Villas
Three bed Garapua Beach Resort
340,000 Itacare eco resort
324,000(inland) Lagoa Pearl
530,000 Four bed Garapua Beach Resort spa
villa 455,000 Itacare eco resort
630,000(inland) Natal ocean club
880,000
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• Rental comparables

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Hotel Rooms
Sofitel Salvador 90 Gran Hotel Stella Maris
92 Hotel Studio do Carmo 94 Holiday Inn
Salvador Bahia 99 Bahia Othon Palace
100 Villa BahiaAverage price 148 Hotel
Casa do Amarelindo 155 Gran Hotel Stella Maris
165 Catussaba Resort Hotel 165 Zank Boutique
Hotel 186 Aram Yamí Hotel 187 Pestana Bahia
Lodge Residence 190 Pestana Convento do Carmo
Hotel 243
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Two Bed Suites
Vila Galé Salvador 105 Pestana
Bahia Hotel 112 HOLIDAY INN Two
bed 120 Gran Hotel Stella Maris
129 Gran Hotel Stella Maris 141 Fiesta Bahia
Hotel 166 Casa de Prince 193 Hotel Casa
do Amarelindo 205 Aguas Brasil Villa Retreat
205 Hotel Villa Santo Antonio 213 Pestana
Convento do Carmo 244 Aram Yamí Hotel 297 A
Casa das Portas Velhas 314
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• Rental projections

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Projected Gross Income

• Studio apartment
• Based on 100pn x 85 occupancy 15,500
• Two bedroom apartment
• Based on 150pn x 85 occupancy 23,250
• Three bedroom villa
• Based on 200pn x 85 occupancy 31,000

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Break even point

• Studio apartment
• 50,000 unit
  needs 3,250pa
• Hotel needs to take 17 pn
• One bed apartment
• 70,000 unit needs 4,550 pa
• Hotel needs
  to take 24 pn
• Two bed apartment
• 100,000 unit needs 6,500 pa
• Hotel needs
  to take 35 pn
• Three bed villa
• 340,000 unit needs 22,100 pa
• Hotel needs
  to take 121pn

• Based upon 100 occupancy excluding monthly
  management fee and assumed 100 mortgage at
  interest rate of 6.5pa

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• Costs, fees tax

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Fees
ITIV (similar to VAT) 3Notary office
1.25Registration of the deeds
0.75Administrative expenses 1Legal fees
approx. 1.5
Individuals are recommended to take Specialist
advice
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Taxation
No local inheritance tax Corporation
tax 15 Basic income tax 15 on unearned
income Capital gains tax 15 NB Exemption if the
property is owned for more than 5 years and the
value does not exceed BRL440,000 253,441
Individuals are recommended to take Specialist
advice Source http//www.internationalliving.com/
Countries/Brazil/Taxes
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