EFTA01469771.pdf

Les Bordes opportunity May 2014 EFTA01469771 Disclaimer In preparing these materials, neither Deutsche Bank nor any of its affiliates has acted or is acting (and does not purport to act in any way) in a fiduciary capacity. Deutsche Bank AG, acting through its London branch ("DB") has prepared these materials for Blue Star International Group ("BSIG"). In doing so, DB is acting to assist BSIG and no other person in connection with these materials or their contents. Deutsche Bank will not be responsible to any person other than BSIG for providing any of the protections afforded to clients of DB, nor for providing any advice in relation to any matter referred to herein. Without limiting a person's liability for fraud, neither DB nor any of its affiliates nor any of its or their respective directors, officers, representatives, employees, advisers or agents shall have any liability to any other person in connection with these materials. 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DB has been authorised by BSIG to provide and distribute this document (the "Marketing Materials") on its behalf in connection with the Opportunity. These Marketing Materials are provided for information purposes only to a limited number of persons who may be interested in the Opportunity and for no purpose other than to assist such persons in deciding whether they wish to purchase any Assets. These Marketing Materials are provided on the basis that each recipient of the Marketing Materials (a "Recipient") and such Recipient's representatives, directors, officers, employees and professional advisers keep them and the existence of the Opportunity confidential. 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Neither these Marketing Materials nor anything contained herein, nor any other oral or written information made available to any Recipient (save for any representations and warranties expressly set out in a sale and purchase agreement entered into between, on the one hand, any purchaser of Assets and, on the other hand, BSIG), form the basis of any contract or commitment whatsoever. Neither the provision nor the distribution of these Marketing Materials (nor any of their contents) should be considered as any form of recommendation or commitment on the part of BSIG or DB to proceed with any transaction. 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EFTA01469776 Overview of the opportunity Build the world's most exclusive residential development and country club 1,600 acre of unspoiled tranquility with a rich history — Situated in the heart of the Loire Valley, the location of choice for generations of French royal families and aristocracy to situate their magnificent chateaux and hunting estates — First archaeological evidence of settlement on Les Bordes estate dates back over 3,000 years; home to a small monastic order in the Middle Ages and hunting grounds for noblemen for centuries — In 20th century, home and retreat of Baron Marcel Bich, founder of the Bic pen and razor empire — In 1986, Robert Von Hagge created the "Augusta of Europe", an 18 hole course that would be one of the most sought after in the world Europe's number 1 golf course — Golf World "One of the most enchanting picturesque and tranquil settings in the whole of France." Wall Street Journal "Les Bordes raises expectations dangerously for the rest of our golfing life. Golf could get more luxurious, but probably only if each three-ball had its own personal team of ground staff just ahead of it, attending to each green with nail scissors and microfibre cloths. Each hole is a rampantly imaginative feat of risk-reward architectural perfectionism." Financial Times "The course remains Robert Von Hagge's finest work. As a picture of golfing excellence, there are few locations to rival Les Bordes." The Daily Telegraph "Eighteen of the most terrifying but enjoyable holes imaginable." The Guardian "It should unquestionably, undeniably, be in anyone's top-five in the world." Golf World Magazine Total land area Total POS approved area Total build density Perfectly located in the "Garden of France" Nearest transportations Paris Les Bordes — Nearest train station: 9km — Nearest airport: 47km 10km from Château de Chambord — 3rd most visited historic monument in France Distance from Paris — 75 min by train — 90 min drive EFTA01469777 — 35 min by helicopter Approximate flights times to Paris — from London:lh — from Moscow: 3h — from Doha: 5h30 — from New York: 7h — from Los Angeles: 10h30 Approximate helicopter times to Les Bordes: — from London: 1h30 — from Nice:1h45 Approximate helicopter times to Les Bordes: Planning in place to create Europe's largest residential and leisure development Developments 400 Les Bordes golf lodges 50 luxury Les Bordes estates 240 hotel branded residences Other facilities Hotel Spa Château Bel Air, boutique hotel Total SQ M 162,797 75,000 56,856 6,427 4,000 4,000 2,660 311,739 SQ FT 1,751,693 807,000 611,766 69,155 43,040 43,040 28,622 3,354,315 5,600,000 sq m 353,921 sq m 6% Potential facilities to include — Hunting estate — Equestrian centre — Tennis academy — Shooting academy — Cookery school EFTA01469778 — Car livery service — Adventure playground — 24 hour security 1 EFTA01469779 Key investment highlights Les Bordes Golf, a unique trophy asset — One-off opportunity in prime Western Europe Extraordinary planning consent with strong support from the regional and local authorities Attractive market with strong fundamentals — Unique planning permission to develop a landmark resort of 3.8m sq ft within a world heritage site — Exciting prospect for the region expected to generate c. 1,750 jobs — Strong demand for high-end and luxury residential resort properties, driven by the substantial growth of wealth creation in emerging markets — Most visited country in the world (c. 80m foreign tourists a year) with Château de Chambord amongst the top three most visited historic sites in France — Already existing golf course leveraging Les Bordes' excellent reputation Low risk profile with attractive returns — Self financing project in the third year of development thanks to residential phased sales resulting in limited cash flow requirements — Golf course consistently ranked as number 1 in Europe by Golf World magazine and among the best golf courses in the world Highly experienced team of advisors in place — Full team of highly experienced professionals already mandated 2 EFTA01469780 Les Bordes Golf, a unique trophy asset Existing site Proposed developments Europe's number 1 golf course, Les Bordes Championship 18 hole golf course: — golf course, practice greens and driving range — offices, storage facilities, clubhouse: c. 11,000 sq ft — 10 cottages providing 41 letting bedrooms: c. 23,000 sq ft Two further 18 hole golf courses: — golf course, practice greens and driving range — clubhouse: c. 8,000 sq ft — storage building and ancillary building with apartment Château Bel-Air, an ornate 1906 château — main building: c. 29,000 sq ft — ancillary buildings: c. 12,000 sq ft An equestrian property comprising a house, several stables and grazing land Les Bordes — private estate aimed at UHNW individuals — Development of 50 super prime estates ranging from 400 to 2,000 sqm. These residences will have access to the services of the 5-star hotel — Development of 400 prime golf homes of 300 sqm — Existing Château Bel Air to be refurbished and operated as a boutique hotel Le Ganay — master planned community open to the general public and aimed at a young and successful demographic — Development of 240 hotel branded residences ranging from 160 to 300 sqm — Development of amenities including a village square with retail units, tennis centre, fitness centre, shooting academy, equestrian centre, 200 acre children's adventure playground, organic farm and cookery school — Development of a 5-star luxury hotel with beauty spa 3 EFTA01469781 Extraordinary planning consent with strong support from the regional and local authorities Permits and authorisations received 24 December 2009 6 June 2010 15 February 2011 19 July 2011 13 January 2012 24 April 2012 9 May 2012 31 October 2012 6 January 2014 POS (modification of land use) PUP (local Commune agreement for services) Diagnostic archaeological survey Phase 2 Tree clearance permission Site infrastructure permission Phase 3 Road and path declassification Land exchange with local Commune Phase 4 Water law permission — Development of 3 luxury homes Infrastructure work commenced Phase 5 — Development of 24 lodges — Development of 20 hotel branded residences 4 — Development of 23 luxury homes — Development of 176 lodges — Development of 60 hotel branded EFTA01469782 residences Project phases (10-year development) Les Bordes — Development of 2 luxury homes Phase 1 — Development of 24 lodges — Development of 6 luxury homes — Development of 52 lodges — Development of 16 luxury homes — Development of 124 lodges Le Ganay Golf — Development of new Ganay course — Hotel & spa development — Ganay course completed — Hotel operational Le Ganay residences — Agree hotel operator — Development of 20 hotel branded residences — Development of 60 hotel branded residences — Amenities operational — Development of 80 hotel branded residences Amenities — Development of tennis, equestrian & shooting centre EFTA01469783 Attractive market with strong fundamentals Strong demand for highend and luxury residential resort properties, driven by the substantial growth of wealth creation in emerging markets Most visited country in the world 2012 International tourists (in m) 83.0 67.0 57.7 57.7 46.4 3 35.7 30.4 29.3 Source: World Tourism Organization Attractive length of golf stays 1 Arc de Triomphe 10 2 Mont Saint Michel 5 Château de Chambord 8.6 10.8 10.1 11.1 Top visited historic sites Strong growth of UHNWIs, our target market CAGR 2008 - 2012: 8.5% 15 11.9 UHNWI 187k 0 2008 2009 North America Latin America 2010 Asia-Pacific Middle East Source: World Wealth report 2013, Capgemini Key demand factors for second homes 80% 60% 40% EFTA01469784 20% 0% Cultural/ historical attractions Source: KPMG Golf Insights 2013 Golf Beach Children's entertainment Source: Savills 2013 5 Marina entertainment Lake Ski 2011 Europe Africa 2012 Average length of golf stays (2012) Number of HNWIs (m) EFTA01469785 Low risk profile with attractive returns Self financing project in the third year of development thanks to residential phased sales results in limited cash flow requirements Financial summary Sale price (€ / sq ft) Net sales(1) (€m) Cost (€ / sq ft) Residential development # of luxury estates # of luxury golf lodges # of hotel branded residences Total Hotel & other facilities Additional value created from hotel and other facilities (€m) Hotel and other facilities development costs(4) (€m) Infrastructure Infrastructure development costs(3) (€m) Total estimated profit (€m) Profit on costs Time horizon (1) Net sales post marketing, agency and legal fees with 2% inflation assumed on sale price per sq ft across project time horizon (2) Total cost post contingency and professional fees with 2% inflation assumed on cost per sq ft across project time horizon (3) Includes central infrastructure and existing chateau refurbishment (4) Includes Hotel and facilities development and central overheads 6 Total Cost(2) (€m) Total Profit 1,022 850 883 883 1,628 561 3,039 (279) (200) (200) (315) (504) (173) (992) 535 1,124 388 2,047 63% EFTA01469786 69% 69% 67% 104 (61) (66) 2,024 1.8x 10 years EFTA01469787 Highly experienced team of advisors in place Professional team Programme Management Cost Management Project Management Consultant Initial feasibility Operations Hotel Les Bordes Concept Master Planner Hart Howerton Contractor Riko Group Golf Power Infrastructure Water Architecture Resort HKS Residential Anderson Orr Surveying/Roads Cabinet Perronnet Estate Management Golf Course Von Hagge Landscape/Planning EDSA Sales and marketing Sales Sales Europe & Africa 13% APAC 5% 2013 sales volume by region Continental Europe 9% APAC 41% US 1% UK 49% US, Legal Lefevre Pelletier EFTA01469788 Communications PRCo Canada & S.America 82% Note: Additional local team members have since been engaged through competitive bid process for Architect of record, Environmental, SPS (health and safety), Soil Survey, Bureau de Controle (regulatory conformity) 7 EFTA01469789 Appendix I Additional information EFTA01469790 Comparable developments Golf/Country club community sale prices 2,419 1,998 1,359 1,299 1,223 1,217 1,200 1,126 1,123 Average: 1,109 1,104 1,022 1,014 924 883 829 783 754 742 687 Coming to the market hotel branded residence sale prices Average: 1,734 9 Sale price (in €per sq ft) Pebble Beach Saint Tropez Golf Fisher Island Kiawah Island Wentworth Sheraton Pines Carlton Grand Cayman K Club Golf de Gassin El Dorado LB luxury residence Le Golfe Juan Royal Mougins LB luxury lodge Bears Club Bighom La Zagaleta Sandy Lane Sotogrande EFTA01469791 Project master plan Le Ganay golf course — redesigned by Robert von Hagge 5-star hotel with branded residences Existing Club House Equestrian Centre Les Bordes golf lodges Organic farm Sports and Fitness village Village and Golf Club House Mayr Spa Hotel branded residences Les Bordes private estates: 150 plots which can be combined to build ambassadorial estates or Lodges Chateau Bel-Air Les Bordes golf course & private estate Europe's #1 golf course Hunting Lodge NORD Om 100m 200m 400m 10 EFTA01469792 Taxation on holiday homes in France The typical buyer of a holiday home in France tends be looking for low risk, long term value Most people will expect to own their properties for many years and are unlikely to be looking for a quick gain French Rental Income — Non-Residents — French income tax on French rental earnings is payable by both residents and non-residents alike — However France has double taxation agreements with many countries, so in most cases people are unlikely to be taxed twice on the same income — The basic rate is 20% of tax on the net rental income for non-residents. Non-residents are not liable for a further 15.5% social charges provided the property is a furnished letting Capital Gains Tax — If you are resident in the EEA then capital gains tax is charged at a rate of 19%. Plus a further 15.5% social charges. However the French system of taper relief reduces the amount on which capital gains tax and the social charge is levied — There is a complete exemption from capital gains tax after 22 years of ownership, with tapered relief from the 6th year of ownership. The method by which this is achieved is a discount of 6% a year from the 6th year, and 4% in the final 22nd year — There is complete exemption from the social charges after 30 years of ownership again with taper relief form the 6th year of ownership llcowdsir: FOR U.S. KEY CLIENT PARTNER (KCP) CLIENTS ONLY. NOT FOR FURTHER DISTRIBUTION. cowdsir: 018080 051514 EFTA01469793