Flavours of Fruitful Resort Investment

Flavours of Fruitful Resort Investment

Contents:• About HighGround• Why invest in 5* resorts?• Flavours• Sample developments

About HighGround Property Investment• Directors and staff - UK & Overseas Investor backgrounds (over 18

years combined experience).

• Company founded in 2007.

• Passion to create passive income streams for our customers.

• We are Full Members of the AIPP industry body.

• Locations include the Caribbean, Brazil, France, Turkey and the

Cape Verde islands.

• We reject 95% of candidate property developments offered.

• Investment first, everything else is a bonus!

Why Invest in Property?

On average, property prices double every 10-12 years.

The yields are often higher than bank interest rates.

Assets such as stocks and shares can lose their value overnight - that is

unlikely to happen with property.

50% of names on The Times Rich List made their money from investing in

property.

Historically one of the best asset class for performance…

Why invest in managed resorts?• Increased value when completed and operational.

• Fully managed rental programmes.

• Is Commercial Property – potentially tax-efficient.

• Payment structures allow you to pay affordable instalments.

• A way of diversifying an existing investment portfolio without the

overheads of being a “Landlord".

• An enjoyable asset!

Our Niche Market - Luxury Tourism

Finest 5* facilities

Strongest rental market

Most stable rental market

Commercial property

Fully Managed

Personal usage

Passive income

What are the “flavours”?• Flavour 1 - Refurbishment:

• Benefit from restored character property in an

established location.

• Tap into an existing tourist market.

• Only wait weeks or months before gaining rental

income.

• Hold the property long term and enjoy the rental

income.

What are the “flavours”?• Flavour 2 - Off-Plan:

• Benefit from a below market value transaction.

• Increased value when completed.

• Must often wait several years before gaining rental

income

• Can sell for capital gain (even before completion) or

• Remortgage at market value for a cash lump sum.

Refurbishment Example

5* Luxury with historic French charm

Chateau de la Cazine,Central France

5* Luxury with historic French charm

• The world’s most popular tourist destination.

• The fifth largest economy in the world.

• Property prices have remained steady thanks

largely to prudent lending criteria prior to the

“credit crunch”.

Why Invest in French Tourism?

About the Resort• Stunning French Chateau development.• Luxury Spa occupying the entire Petit Chateau, offering:

• Massages, beauty treatments and holistic therapies• 18-Hole Golf Course.• Superb fishing facilities.• Plan is regain of Michelin Star to the restaurant:

• expected within 12 months of opening• Off-plan Village luxury accommodation to accompany the Chateau.

The Main Chateau - Financials• Refurbishment Project,

• so early income, steady growth...• Rental income from March 2012• Guaranteed rental income period (5% or 8%)• Expect 11%+ net income thereafter .• Developer offer to buy back property after 5 or 10 years

at 150% of purchase price.• Fractional Ownership available.• Can invest via a SIPP (from £18,800 invested)

Starting price of just £4000 (non-SIPP)

The Main Chateau – Case Study• Real Example (disclaimer!):

• Reserved Chateau Suite for £28k• Set up a SIPP and transferred cash to fund a 67%

deposit.• Was able to claim tax rebate on transferred funds.• Used developer finance for the 33% balance.• Total cash investment before rebate including all

charges over term: £17,000.• Buyback option of 150% of purchase price in 10

years, so…• If rental income is the expected 13% p/a years 3-10,

total return will be £50,480 from a £17k investment. Nearly 300% in 10 years.

Off-Plan Example

5* Turkish Delight!

Harmony Bay Resort & Spa, Turkey

5* Turkish Delight!

• Fastest growing tourism market in the world.– Record-breaking 31m tourists in 2011– And yet, already well-established.

• World’s greatest GDP growth in first half of 2011.• Falling inflation & interest rates.• Rising employment.• Awarded Condé Nast International Traveller

Award for ‘Favourite Destination’ 2nd place in ‘World Top 100’.

Why Invest in Turkey?

About the Resort• Luxury 5-Star Spa & Leisure Resort.• Multi Award-Winning developer.• World-renowned 5* hotel management company to operate the

rental programme.• Area Identified as an investment ‘hotspot’ by leading hotel groups. • 3 weeks personal usage every year (non-SIPP).• Fully furnished properties with magnificent panoramic sea and

mountain views.• Extensive sports and leisure facilities, including Hamam Spa.

Harmony Bay - Financials• Off-plan Project, capital growth potential strongest now.• Rental income from completion 2013-15.• Meanwhile, 4% income on deposit.• Guaranteed rental income period (8%) for 2 years.• Expect 10%+ net income thereafter.• Buyback Guarantee in 5 years (at purchase price).• Fractional Ownership available (SIPP only).• Can invest via a SIPP (full purchase price only).

Starting price of £12,250 + costs

Harmony Bay – Case Study• Real Example (disclaimer!):

• Reserved Harmony Bay 25% fraction for £12,250.• Set up a SIPP and transferred existing pension fund of

£16k to cover closing costs and SIPP setup charges.• Income of 4% until completion (~2 years).• Rental Guarantee of 8% for 2 years from 2013/4.• Annual SIPP charges ~£300.• Buyback option of 100% of purchase price in 5 years.

after completion, so can exercise this to exit in Year 7 as early exit strategy.

• If rental income is the expected 10% p/a years 3-10, net return will be £22,890 from a £16k investment. 143% in 5 years. Treat as worse case.

• Or can hold (or reinvest).

Thank You!