The Blue Marlin Hotel, Scottburgh, South Africa available for re-development!

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Information about The Blue Marlin Hotel, Scottburgh, South Africa available for...

Published on February 11, 2009

Author: Thinus_Pienaar

Source: slideshare.net

Description

Purchase the land and existing structure for R60m from the current owner, conditional on the seller settling any claims from timeshare owners (25% shareholding). Construct apartments and hotel for R286m, and realise R303m by selling sectional title apartments. Surplus of R16.4m (excl land) realized, plus a hotel asset (with no construction debt). Income stream associated with the hotel is reflected in the hotel feasibility. Upon completion of the hotel it is estimated that it would have a value of approximately R100m, representing a 40% increase!

In association with Laurusco Developments (Pty) Ltd Development Opportunity Erf 885,888,889,896,897 - Scottburgh Development Facilitators, Property Brokerage, Project and Construction Management to the Property Industry Jason Wilkes and Eric Quevauvilliers

Locality and Aerial Jason Wilkes Eric Quevauvilliers 084 245 2158 083 293 3133 Laurusco Developments (Pty) Ltd

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Layout Concept for Feasibility Jason Wilkes Eric Quevauvilliers 084 245 2158 083 293 3133 Laurusco Developments (Pty) Ltd

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  • Feasibility and Building Estimate Jason Wilkes Eric Quevauvilliers 084 245 2158 083 293 3133 Laurusco Developments (Pty) Ltd
  • Blue Marlin - Investment Proposal HOTEL APARTMENTS TOTAL Revenue from Sales - Dec 2011 302,731,000 302,731,000 Cost - Land 0 Cost - Building 70,103,000 216,234,000 286,337,000 Development Cost 70,103,000 216,234,000 286,337,000 Surplus -70,103,000 86,497,000 16,394,000 Land Acquisition 60,000,000 Construction Cost 286,337,000 Proceeds Dec 2011 302,731,000 Surplus on construction (excl land) 16,394,000 Net Present Value - Projected Hotel Income Stream Forecast Discounted Discount % 30% Terminal Growth 15% Year 1 Per Hotel Feasibility Year 4 (2012) -1,544,421 -540,745 Year 2 Per Hotel Feasibility Year 5 (2013) -383,119 -103,185 Year 3 Per Hotel Feasibility Year 6 (2014) 2,657,441 550,558 Year 4 Per Hotel Feasibility Year 7 (2015) 6,354,296 1,012,661 Year 5 Per Hotel Feasibility Year 8 (2016) 9,829,573 1,205,002 Year 6 Per Hotel Feasibility Year 9 (2017) 11,723,195 1,105,493 Yield 12% Year 7 Per Hotel Feasibility Year 10 (2018) 13,456,339 976,098 Value 112,136,158 Infinity Value 101,508,873 105,714,755 Internal Rate of Return 2009 2010 2011 2012 YEAR 1 YEAR 2 YEAR 3 YEAR 4 -60,000,000 -143,168,500 265,277,255 Internal Rate of Return 22.5% Investment Proposal Purchase the land and existing structure for R60m from the current owner, conditional on the seller settling any claims from timeshare owners (25% shareholding). Construct apartments and hotel for R286m, and realise R303m by selling sectional title apartments Surplus of R16.4m (excl land) realized late 2011, plus a hotel asset (with no construction debt). Income stream associated with the hotel is reflected in the hotel feasibility. Upon completion of the hotel it is estimated that it would have a value of approximately R100m, representing a 40% increase over estimated construction costs (per MLC feasibility). Assumptions Infinity value of hotel income takes terminal growth rate (growth in Year 7 per the hotel feasibility workings) and factors in a present value of 30% No tax considerations are taken into account It is assumed that construction will take two years and will occur in 2010 and 2011. Income from the Operating Management Agreement is ignored in the calculations valuing the hotel. It is treated as a cost and assumed to be paid to an external third party.
  • Draft Hotel Feasibility Cost Escalation 10% Hotel Rooms (No) 70 Room Nights ( room days) 25,550 Rate ( R) 750 850 1,000 1,200 1,350 1,500 1,650 Occupancy ( %) 55% 56% 58% 60% 62% 62% 62% Rental Pool Rooms (Apartments) 328 Rental Pool Nights 119,720 Rate ( R) 750 850 1,000 1,200 1,350 1,500 1,650 Occupancy (%) 30% 30% 35% 35% 40% 40% 40% Net % Share of Rental Income 10% 2012 2013 2014 2015 2016 2017 2018 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 Hotel Room Rentals 10,539,375 12,161,800 14,819,000 18,396,000 21,385,350 23,761,500 26,137,650 Food & Beverages 60% 6,323,625 7,297,080 8,891,400 11,037,600 12,831,210 14,256,900 15,682,590 Gross Income 16,863,000 19,458,880 23,710,400 29,433,600 34,216,560 38,018,400 41,820,240 Rental Pool Income (Apartments) 10% 2,693,700 3,052,860 4,190,200 5,028,240 6,464,880 7,183,200 7,901,520 Cost of Sales (Room) 25% 2,634,844 3,040,450 3,704,750 4,599,000 5,346,338 5,940,375 6,534,413 Cost of Sales (F&B) 30% 1,897,088 2,189,124 2,667,420 3,311,280 3,849,363 4,277,070 4,704,777 Gross Profit 15,024,769 17,282,166 21,528,430 26,551,560 31,485,740 34,984,155 38,482,571 Overheads 50% 8,431,500 9,274,650 10,202,115 11,222,327 12,344,559 13,579,015 14,936,917 Property costs 6% 1,011,780 1,112,958 1,224,254 1,346,679 1,481,347 1,629,482 1,792,430 Management fees 9% 1,517,670 1,669,437 1,836,381 2,020,019 2,222,021 2,444,223 2,688,645 EBITDA 4,063,819 5,225,121 8,265,681 11,962,536 15,437,813 17,331,435 19,064,579 Depreciation 8% 5,608,240 5,608,240 5,608,240 5,608,240 5,608,240 5,608,240 5,608,240 Profit before Tax -1,544,421 -383,119 2,657,441 6,354,296 9,829,573 11,723,195 13,456,339 Growth 75.2% 793.6% 139.1% 54.7% 19.3% 14.8% Yield 12% Value of Asset 112,136,158
  • Umdoni Municipality Zoning and VALUATION Jason Wilkes Eric Quevauvilliers 084 245 2158 083 293 3133 Laurusco Developments (Pty) Ltd
  • ,1fi47 sIC.ffC BLUEM*RLI!IHflIFL T;{A.FEELOC!{lTD sCOfi S]EEET $3S SCATTBUFGH .)!g 1 ']F i10,quot;quot;1:[ir]c ELUEIITARLIFI HOTEL:}IFffi Blflfri{ LTD I SCSTTSTfiEFT i I 814 SSTffF SCOTTEUFGH 4{4i ELUEI!{.AFLIN HOTEL!iIAFE BL6Ci'{LTD tg tfio SCOTTSTRST FCtrNOH 4 fiF ESA SCOTTELRCH OF BLUE MARLII,I HOTTL S{AFEBLfiCI{ FCEquot;tloN OF5td OFECdTTgtfrGn I ;gf .nc0 LTD Jt€ I sCflTT STqEET 1S4 tt*Fllri H6TEL:.i{4trgLCCi,{ PCfirCtJ 10F 5i? OFsC0TTS',.frC#l ELUE x5t i80 ,j:e I STREET 434 SCOTT '-TD I|{ARLIN HO]EL S55 SCOTTBURGH OF BLUE si{AR=BLOCi{ LTn JTO $3ri,oc I ldtRltiETERRACE l N FQ :rt lcc 893 OFSCCTTBURGH ELUE MAFLIN HOTEL:HAFE SLOII{ LTTI SCOTT STRFET 3C.JTI .9TlE=T 1E r.D a J- !all3s rrth | 8i1 BcottrLrgl t tfL H. - r a -:ii- M2 Zoning Valuation Far Coverage FAR coverage ERF Use 232 104,4 R 271,000.00 ComRes1 45Yo 1.5 889 vacant 348 1058 ComRes1 476.1 R 501,000.00 1.5 45o/o 1587 rem 888 vacant public park 434 R 351,000.00 car Ptn 1 887 vacant public park 194 R 255,000.00 car Ptn 1 886 vacant ,16A public park R 236,000.00 car Ptn 4 898 vacant ComRes1 .15 R 40,000,000.00 4447 1821 897 built 6070.5 1.5 45o/ o ComRes1 1821.15 R 830,000 00 4047 896 vacant 6070.5 1.5 450/o 1716.3 R ComRes1 3814 5721 885 built 1. 5 45o/ o R 42,444.000.00 13982 19797 5939.1 (All information derivedfrom UmdoniMunicipalValuatjon and Planning Roll SchemeDocuments) ,rt, .lt.-. riil:i,,:t r ,/ ,,tJr_i , i {:' r

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