Fractional sale pitch alternaty-august

C A P A B I L I T Y S T A T E M E N T O NC A P A B I L I T Y S T A T E M E N T O NF R A C T I O N A L S A L E P R O G R A M

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P R E P A R E D F O R X X X X

28/07/2012

Al Al i R l EAlternaty – Alternative Real Estate

Alternaty is a boutique real estate firm providing a suite of consulting services h h h d l lif lthroughout the development lifecycle.

Our team has 17 years of combined experience in the real estate industry with an extensive track record in hotel and resort advisory in Vietnam.y

More than 40 hotel and resort valuations in Vietnam, Laos and Cambodia

More than 35 feasibility and market studies in Vietnam and Cambodia8 operator selection advisory assignments in Vietnam

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8 operator selection advisory assignments in Vietnam

28/07/2012

H C W H l Y ?How Can We Help You?

Alternaty is a boutique real estate firm providing specialist advice for hotel resort

Boutique Consulting

Operator Selection

Investment Services

Investor Representation

Alternative Real Estate

Alternaty is a boutique real estate firm providing specialist advice for hotel, resort and second home projects. Our approach is to forge partnerships with developers to provide a suite of consulting services throughout the development lifecycle. We specialise in the implementation and operation of alternative real estate structures.

Condo Fractional

Private Residence & Destination

Club

Vacation Ownership

Hotel Investment

HotelOwnership Club

Alternative Real Estate

Alternative real estate structures offer a range of options in addition to the traditional forms of freehold and leasehold ownership. The flexible nature of the structures means that developers are able to select and tailor the structures to

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the specific requirements of the project, target market and legal jurisdiction.

How can we assist you?

Investment Brokerage

Operator Selection

Investment Villas Sale and Marketing

Hotel Valuation Feasibility studies

Investment Villas Sale and Marketing

y

Advisory Services

Hotel Asset Management

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Al i R l E P dAlternative Real Estate Products

2) Fractional Ownership 3) Private Residence & Destination Club

1) Ti h i

4) Branded Residence

1) Timesharing

5) Condotel

1) Hotel Rooms

2) F h ld O hi 3) L h ld O hi

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2) Freehold Ownership 3) Leasehold Ownership

FRACTIONAL SALE FRACTIONAL SALE OPTIONS-

INDOCHINA

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1 T f P d1. Type of Products

1. Whole Ownership No Rental Pool

2. Whole Ownership With Rental Pool

3. Fractional – Quarter Share (4)

4. Fractional – Twelfth Share (12)

5 TimeSharing5. TimeSharing

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1 T f P d1. Type of Products1.1 Whole Ownership No Rental Pool

Full priceNo obligation for specific standard of furnitureNo rental management providedTypically use week ends or holiday weeks (actual usage is approximately 8 13 weeks per year)approximately 8 - 13 weeks per year)Limited option of management (no rental)Investment gain:

1 Capital appreciation only

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1. Capital appreciation only

1 T f P d1. Type of Products1.2 Whole Ownership With Rental Pool

OwnerOwnerUse 3 months (for

instance)

OwnerOwner

Rental Pool (9 months)50% ( )

50%

• Management fee

• Operation costs

DeveloperDeveloper

50% • Operation costs

• Maintenance fee

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1 T f P d1. Type of Products1.2 Whole Ownership With Rental Pool

Full priceObligation of a specific furniture packageg p p gTypically management company is involvedTypically owner usage allowed is 30 - 60 days High management fee (International brand)High management fee (International brand)Investment gains:

1. Capital appreciation 2 Rental pool system(Revenue - operations cost - developer 2. Rental pool system(Revenue - operations cost - developer

share)In Vietnam this model is currently failing (the selling price is too high and low returns)too high and low returns)

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1 T f P d1. Type of Products1.3 Fractional – Quarter Share (4)

Use of Maximum 3 Months each (13 weeks) Use

1) Owners usage system

Rotation or points 2) Exchange system

3) Rental Pool (management)

system

for unused weeks

• Management Fee

• Maintenance Fee

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1 T f P d1. Type of Products1.3 Fractional – Quarter Share (4)

Quarter of the price (1/4) + Premium for fractional club membershipRecommendation on specific furniture packageTypically no management company involved managed by Typically no management company involved, managed by the developerTypically owner usage allowed up to 13 weeks (3 months)Rental pool option available for unused weeksRental pool option available for unused weeksExchange program for owners Floating weeks or fixed weeksMembership club benefits (Golf club, gym, spa, etc) p ( gy p )

Investment Gains: 1. Capital appreciation2. Share appreciation 3. Rental pool system (Revenue - management fee)

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1 T f P d1. Type of Products1.4 Fractional – Twelfth Share (12)

4 weeks Use

1) Owners usage system 2) Exchange system

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g y

Rotation or Points

g y

1 T f P d1. Type of Products1.4 Fractional – Twelfth Share (12)

Lower price (1/12 of price) + premium for fractional club membershipObligation for a specific furniture packageTypically no management company managed by the Typically no management company, managed by the developerTypically owner usage is up to 4 weeks per share (1 month)Typically there is no rental pool option but rental from share Typically there is no rental pool option but rental from share owner Exchange program Membership club benefit (Golf club, gym, spa etc)

Investment gains: 1. Vacation program (no hotel/resort management cost)

Sh i ti 2. Share appreciation 3. Rental pool system (Revenue - management fee)

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1 T f P d1. Type of Products1.5 Fractional vs Whole Ownership

Lower investment entry level (can be as low as US$20,000 per share)Use only what is needed (second home is used only 4 - 8 y ( yweeks per year)Higher return for rental pool management

Lower operational costspLower brand costs (maintenance fee)Shorten rental period to fill (if you own 1 month, you only have 4 weeks to rent, if you own 12 month, you have 52 y yweeks to fill)

Option of exchange system (Vietnam or overseas)Higher capital gain (if property price increase and if share g p g ( p p y pprice increase)Club benefits (discount F&B, spa, golf etc)

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1 T f P d1. Type of Products1.6 Complexity of Fractional

Creation of the membership program and usage rotation

Points system management

Expensive Marketing (intensive or soft sale)Expensive Marketing (intensive or soft sale)

Sale training program

Exchange system

Pricing and upgradesPricing and upgrades

Resale options and membership transfers

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1 T f P d1. Type of Products1.7 Exchange System

International International Exchange

L l E h

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Local Exchange

1 T f P d1. Type of Products1.8 Legal Considerations

Contract type (lease)Contract type (members)ypOption to buy backOption to terminateOption to terminateObligation for the lesseeR t l P l P t tRental Pool Payment systemMaintenance Fee

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SETTING UP PROCEDURE

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Process Set up

Preparation and consultancy 2 -3 monthsPreparation and consultancy

Pre Launch

Launch 3-6 months

Membership Management

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Preparation and consultancy

Product build up : Expected 1-2 months

pPrices,

Rental Program,Membership Benefits and UsageMembership Benefits and Usage,

Membership ProcedureMaintenance/ Management fee, Product Use and Limitations Product Use and Limitations,

Investment Program (Cash flow)Investment Program (Structure),

D l P i t f i (Ri k d R t ) Developer Point of view (Risk and Returns) .. ... ..

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Preparation and consultancy

Marketing preparation :

Expected 1-2 months

Marketing preparation :Branding Consideration (names, positioning..)

Brochures preparation, Websites page (Alternaty website),

Soft Marketing,Sale Material (pitch)(p )

Digital Marketing,Sale Training,

Press Release,Press Release,Networking collaborators

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Preparation and consultancy

Legal support L l d t i ( l i t f i )

Expected 1 month

Legal document review (sale point of view)Legal document review (membership management point of

view)view)

Exchange systemExpected 2-3 months Exchange systemPresentation of Options, Collection of Proposals,

Expected 2 3 months

Fee Negotiations,Internal Program

and External Program implementation Slide 23 28/07/2012

and External Program implementation

ALTERNATY DIRECTORS' TEAM

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CV Of Al M TCVs Of Alternaty Management TeamMauro Gasparotti

Responsibilities Mr. Gasparotti holds the position of Executive Director at Alternaty (Vietnam). In addition to his business development responsibilities, Mauro specialises in hotel investment and consultancy, feasibilities studies, cash flow analysis, market analysis, projects consultancy and operator selection. He also organizes the use and implementation of valuation models for hospitality assets and developments sites.

Professional ExperiencePrior to co-founding Alternaty, Mr. Gasparotti set up and headed the Hotel Services department at CBRE Vietnam and before this he was a Senior Manager in the Valuation and Advisory department Prior to joining CBRE Mr Gasparotti worked in an international financial consulting department. Prior to joining CBRE, Mr Gasparotti worked in an international financial consulting firm in Vietnam.

Following his graduation, Mr Gasparotti moved to Sydney in 2005 where he was employed at Colliers International as an assistant valuer within the Hotels department. Mr. Gasparotti was responsible for implementing valuation models and supporting the valuation process within the d t t I It l M G tti l d t P i I t ti l l di It li l department. In Italy Mr. Gasparotti was employed at Praxi International, a leading Italian real estate consultancy firm, with the responsibility of developing investment and feasibility models for the firm.

EducationE Certificate in Hotel Investment and Asset Management Cornell University

MAURO GASPAROTTI

Executive Director

m +84 908 556 492E-Certificate in Hotel Investment and Asset Management, Cornell University

Master of Business Administration (MBA in International Business Strategy), University of Newcastle, Australia

Master of Science (Econometrics, Finance, Real Estate Finance), University of Parma, Italy

Bachelor of Economics, University of Parma, Italy

t +84 838 293 940

s gasparotti.mauro

[email protected]

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CV Of Al M TCVs Of Alternaty Management TeamRudolf Hever

Responsibilities Mr. Hever holds the position of Executive Director at Alternaty (Vietnam). In addition to his business development responsibilities, Rudolf specialises in alternative ownership structuring and hotel and resort consulting. He has extensive experience in conducting feasibility studies of development projects across Vietnam for hotel, residential, retail, office and industrial projects to specialty properties such as golf courses, luxury villas and resorts.

Professional ExperiencePrior to co-founding Alternaty, Mr. Hever was the Associate Director of the Research and Consulting department of CBRE Vietnam since 2007. During his tenure he was responsible for elevating the department to the market leading position within the industry He is widely recognised for providing department to the market leading position within the industry. He is widely recognised for providing first class research and consulting services and is frequently quoted in the press and TV.

Prior to joining CBRE, Mr. Hever worked in Hotel Valuations in Sydney. He provided research, analysis and market commentaries on the major hotel markets in Australia and wrote hotel investment research reports. Prior to working in hotel valuations, Mr. Hever worked on the d i ti t di d k t S i t G l F h i t t b kderivatives trading desk at a Societe Generale, a French investment bank.

EducationMaster of Science (Real Estate), University of Hong Kong

Master of Real Estate, University of NSW, Sydney, Australia

RUDOLF HEVER

Executive Director

m +84 933 902 530Bachelor of Commerce (Finance and Accounting), University of Sydney, Australia

CredentialsAAPI – Associate of the Australian Property Institute

AFin – Associate of the Financial Services Institute of Australia

t +84 838 293 940

s rudolf.hever

[email protected]

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AFin Associate of the Financial Services Institute of Australia

Registered Property Valuer, Office of Fair Trading, Australia

Undergoing accreditation by the Royal Institute of Chartered Surveyors (RICS)

28/07/2012

CV Of Al M TCVs Of Alternaty Management TeamLy Thai Ha

ResponsibilitiesMs. Ha holds the position of Branch Manager – Hanoi at Alternaty (Vietnam). Her responsibilities include developing and managing Alternaty’s business operations in Hanoi including managing sales, profitability, market share and customer and employees satisfaction by coordinating all sales, branch operation and personal development activities.

Professional ExperiencePrior to joining Alternaty, Ms. Ha was the head of the sales department at Hung Vuong Investment JSC, the owner of Flamingo Dai Lai Resort – a 5 star eco resort in Vinh Phuc province. She was responsible for market & competitor research, information collection & analysis, report preparation, sales & marketing plans as well as launches of the different types of services & real estate products sales & marketing plans as well as launches of the different types of services & real estate products and giving advice to BODs regarding sales & marketing strategies. She also assisted the finance department to search for business partners, investment cooperation and business development and acted as an interpreter for the BODs when working with foreign partners.

Prior to working at Hung Vuong Investment, Ms. Ha was Assistant Director at Tran Hong Quan Co. Ltd th f C Pl W t H i h h i h f i ti th Di t i d il Ltd., the owner of Crown Plaza West Hanoi, where she was in charge of assisting the Director in daily activities, coordinating with the hotel operator , working with the Government authorities to apply for necessary permits, conducting market research, PR, sales & marketing plans and launching leasing activities of the office block.

Ms Ha has solid experience in the hospitality industry especially within sales & operations having hi d i ifi il i h i l

LY THAI HA

Branch Manager - Hanoi

m +84 979 313 100achieved significant milestones in her prior roles.

EducationBachelor of Arts, Hanoi Open University, Commercial English Faculty, Vietnam

Certificate of Securities Market, the National Financial Institute , Vietnam

t +84 838 293 940

[email protected]

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Certificate of Real Estate Agency, Evaluation & Management issued by the Ministry of Construction, Vietnam

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CV Of Al M TCVs Of Alternaty Management TeamTran Mai Doan Thao

ResponsibilitiesMs. Tran Mai Doan Thao holds the position of Head of Sales – HCMC at Alternaty (Vietnam). Her responsibilities include creating and delivering sales strategy for Vietnam South for the AlternatyVacation Club as well as whole unit villa sales.

Professional ExperiencePrior to joining Alternaty, Ms. Thao was the Sales and Marketing Operations Supervisor at Coldwell Banker Vietnam. Her main duties included analysing market information, summarising data & trends, proposing strategies to the Board of Management and developing annual sales and marketing plans.

Prior to working at Coldwell Banker Vietnam, Ms. Thao was an Assistant Sales and Marketing Director at a real estate company. She took full responsibility for generating sales opportunities by identifying appropriate business targets, being involved in all marketing activities and assisting the team to handle all sales inquiries and related matters so that the quality of service s were maintained at a high standards at all times.

EducationMaster Degree in Business and Marketing Management, Solvay Brussels School, Belgium

Bachelor degree in Business Administration, University of Economics, Vietnam

Bachelor degree in Business Administration, Lotus College, Vietnam

TRAN MAI DOAN THAO

Head of Sales - HCMC

m +84 903 180 451 g gt +84 838 293 940

[email protected]

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THANK YOUTHANK YOU

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Disclaimer

This confidential Report has been prepared for the sole purpose of providing information to assist a client indeciding if they are sufficiently interested in the proposed structure to proceed with further investigationincluding to proceed to due diligence, and is not to be used for any other purpose.

No representations or warranties expressed or implied by operation of law or otherwise, are made as to theaccuracy, currency, completeness, suitability or otherwise of the information contained herein, or as to thecondition, quality or fitness of the property and assets. Alternaty (the “Agent”) nor any of the respectivedirectors, officers or employees, shareholders, owners, affiliates, agents or advisors will have any liability tothe recipient of this memorandum or any other person resulting from the recipient or any other person’s use ofp y p g p y por reliance upon this confidential memorandum.

The information contained in this document is intended as a guide only and does not, nor is it intended tocontain all the information that may be required by the recipient to evaluate the potential offer.

This document is made available to the recipient subject to the terms of a confidentiality deed poll and may beThis document is made available to the recipient subject to the terms of a confidentiality deed poll and may beused only for the purposes set forth in such confidentiality deed poll.

This document (together with any further information which may be provided to the recipient) is made availableon the condition that it is for use only by the recipient and shall not be passed on to any other person orreproduced in whole or part and shall be returned along with any other copies or derivatives thereof at anyg y ytime at the request of the Developer.

Figures contained in this document are based on indicative figures provided to Alternaty and have not beenindependently verified by Alternaty.

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