Property Investment Report: Costa Vista Boracay

COSTA VISTA BORACAY BRGY YAPAK MALAY, AKLAN

Your Exclusive Abode in BORACAY 12%

70-90%

Rental Yield

Occupancy Rate

PROPERTY RESEARCHED BY: Ramon Fernando Balbin, RFP, CIPS +63 915 943 7331 ramon.balbin@gmail.com

Cashflow

TABLE OF CONTENT Introduction .......................................................................................... 2 The developer ...................................................................................... 2 The project........................................................................................... 3 Development Component ................................................................. 3

The information contained within this document has been compiled from various sources. While we believe the information to be correct we take no responsibility for errors of omissions.

Please ensure you validate all information.

Unit Layout ....................................................................................... 3 Property pictures.................................................................................. 4 Area growth ......................................................................................... 6 Economic Indicator ........................................................................... 6 Demand Drivers ............................................................................... 6 Area maps ........................................................................................... 7 Location Map.................................................................................... 7

A rental analysis has been provided as an example only. It includes a number of assumptions that have a material impact.

It should be assessed carefully and a rental analysis specific to your circumstances and objectives should be undertaken. We recommend you obtain appropriate legal and technical advice before buying property.

Satellite View.................................................................................... 8 Street view ....................................................................................... 8 Video presentation ............................................................................... 9 Investment proposition ....................................................................... 10 Snapshots ...................................................................................... 10 Value Plan...................................................................................... 10 Area Profile .................................................................................... 11 Greater Area Profile ....................................................................... 11 Financials ....................................................................................... 12 Financial summary...................................................................... 12 Rental analysis ........................................................................... 13 Financial Forecast ...................................................................... 14 Rent comparables.............................................................................. 15 Sale comparables .............................................................................. 17 Pricelist .............................................................................................. 18 Expression of interest ........................................................................ 19 Glossary ............................................................................................ 20

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INTRODUCTION INVEST RETIRE AND EARN Vista Residences is creating its first leisure development in the world famous island in the Philippines, BORACAY. A mixed used development that compose of 5 luxury residential building over 6 floors, commercial strip, beach villas and hotels. Costa Vista is located in Barangay Yapak in between Shangrila and Movenpick Hotel It is believe to give a sound investment particularly for short term strategy due to the rising number of tourist arrivals. This is perfect for investors who would like to retire to an island enjoy the beach and earn a passive income through rentals

THE DEVELOPER

Vista Residences is the condominium development arm of Vista Land. Since its launch in 2003, it has become a formidable player in the fast-growing vertical development sector of the real estate industry. Vista Residences continues to address the rising demand for condominium living with over 50 mid and high-rise towers across the country’s most progressive business districts Vista Residences develops top-tier leisure condominium properties in the country’s most scenic and exquisite locales, and offering hotel amenities and services. Its projects are also located in the most accessible and attractive locations in Metro Manila and in key tourist destinations, near main transportation hubs and right across premier colleges and universities.

With the Philippine economy showing continued growth and Manila currently being one of the top investment cities, real estate in the country will continue to be an attractive business for local as well as foreign investors.

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THE PROJECT Costa Vista Boracay will sit on Punta Bunga beach at the island’s northwestern tip, atop one of the highest points in Boracay.

Surrounded by top hotel chains, it is the only property in the area with direct access to the beach. Situated in Barangay Yapak in Malay, Aklan, it is 15 minutes from popular beaches, White Beach, Bulabog Beach and Mt. Luho. Puka Beach is a quick five minutes from the property.

Development Component

Unit Layout

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PROPERTY PICTURES

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AREA GROWTH Boracay is a small island in the Philippines located approximately 315 km (196 mi) south of Manila and 2 km off the northwest tip of Panay Island in Western Visayas region of the Philippines. Boracay Island and its beaches have received awards from numerous travel publications and agencies. The island comprises the barangays of Manoc-Manoc, Balabag, and Yapak in the municipality of Malay, in Aklan Province. The island is administered by the Philippine Tourism Authority and the provincial government of Aklan. Apart from its white sand beaches, Boracay is also famous for being one of the world's top destinations for relaxation. It is also emerging among the top destinations for tranquility and nightlife.

Boracay was awarded as the 2012 best island in the world from the international travel magazine Travel + Leisure. In 2014, the resort island was at the top of the Best Islands in the World list published by the international magazine CondĂŠ Nast Traveler. In 2016, Boracay headed the magazine's list of Top 10 destinations to watch .

Economic Indicator (Philippiness)

Source: Leechiu Property Consultant/ / Trading Economics

Demand Drivers TOURIST ARRIVAL (1.7M 2016)

By Nationality

Philippine Tourism Performance May 2017 Link

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AREA MAPS Location Map

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Satellite View

Street view

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VIDEO PRESENTATION

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INVESTMENT PROPOSITION Snapshots ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Property Type Price Price/m2 Internal Size Purchasing Cost Turnover of Project Net Rental Yield After Tax CashFlow Cash on Cash Gross Rent Multiplier Expense Ratio Debt Coverage Ratio

: : : : : : : : : : : :

Condominium ₱ 4,334,000 ₱197,000 22sqm ₱ 1,451,015 2022 11.99% +₱61,029 pa, +₱5,066 pm 7.2% 5.65 32% 1.25

Value Plan

Buy and Hold If we are looking for a perfect retirement place, Boracay will be the best option. There is an Economic activity around and yet you can still find your very own sanctuary where you can stay and relax.

A short term rents is the best strategy to maximize the profit of your investment.

Supply

(2014 DOT)

7,684 rooms

Occupancy Rate

70 – 90 % 10

AREA PROFILE Greater Area Profile Shopping Mall - D’ Mall - Talipapa Market Beach -

Puka Shell Beach Banyugan Beach Punta Bunga Beach Diniwid Beach Ilig-Iligan Beach Station 1 2 3

Recreation - Dragon Boat - Scuba Diving - Wind Surfing - Scuba Diving - Snorkeling - Kiteboarding - Cliff diving - Parasailing

Upcoming Supply (HLURB AUG 2017) PROJ_NAME Alta Vista de Boracay Belmont Hotel Boracay Boracay Newcoast Village Chancelor Hotel Boracay Oceanway Residences One Oceanway Residences Two Savoy Hotel Boracay The Rose Pike @ Boracay North Town Center North - Shophouse & Boutique Hotel Districts Villa Margarita

LOTS

RES 540 442

UNITS

197 693 339 252 559 64 179 197

26 2,915

179

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Financials

FINANCIAL SUMMARY

PURCHASE EXPENSES Property Purchase Price Discount Net List Price TOTAL CONTRACT PRICE ANNUAL PROPERTY TAX ₱4,334,000.00 Real Property tax 4,334,000.00 4,334,000.00

ANNUAL EXPENSES

Vacancy

ANNUAL RENTAL INCOME

Standard Residential 43,340.00 Months Rent/Month 12

Rent/Year

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Vacancy

Vacancy

Rent/Year 766,500.00

Rent/Year

Holiday Rental Peak Season 43,340.00 Months Rent/Month Vacancy Rent/Year 365 3,000.00 70% 766,500.00 153,300.00 32,400.00 Mid Season 61,200.00 Months Rent/Month Vacancy Rent/Year

246,900.00 290,240.00 Low Season Months Rent/Month

Interest Only 9.5% Holiday Rental Total 75.0% ₱ 3,250,500.00 Days Rent/Month 15 75% TOTAL ANNUAL INCOME

ANNUAL PROPERTY Expenses Rental Management (Property Mgt, Cleaning, Remittance) Monthly Due 100 Utilities (cable, internet and electricity)

TOTAL 1,353,500.00 TOTAL ANNUAL EXPENSE

PROPERTY PURCHASE EXPENSES Equity Deposit 25% 1,083,500.00 Fit Out 10,000 270,000.00 Legal Miscellaneous -

TOTAL

Loan Expense Loan Details Loan Processing Fee 3.0% 97,515.00 Loan Type Includes Reg Fee, Notarial, Appraisal Title, Investigation and MRI Loan Interest Loan Amount ₱ 97,515.00 Loan Term (Years) ₱ 1,451,015.00 LVR Loan to Value Ratio TOTAL TOTAL PURCHASE EXPENSES

RENTAL ANALYSIS

Strategy SHORT TERM (AIRBNB,Bookings,AGODA) Ave Daily Rate 3,000 LVR 25%(Equity) 75%(LVR) Occupancy Rate Annual Income OPEX Mortgage Pre-tax Cashflow PA Pre-tax Cashflow PM Net Yield ROI 60% ₱ 657,000.00 219,000.00 415,230.88 22,769.12 1,897.43 10% 70% ₱ 766,500.00 246,900.00 415,230.88 104,369.12 8,697.43 12% 80% ₱ 876,000.00 274,800.00 415,230.88 185,969.12 15,497.43 14% Strategy SHORT TERM (AIRBNB,Bookings,AGODA) Ave Daily Rate 4,000 LVR 25%(Equity) 75%(LVR) Occupancy Rate Annual Income OPEX Mortgage Pre-tax Cashflow PA Pre-tax Cashflow PM Net Yield ROI 60% ₱ 876,000.00 262,800.00 415,230.88 197,969.12 16,497.43 14% 70% ₱ 1,022,000.00 298,000.00 415,230.88 308,769.12 25,730.76 17% 80% ₱ 1,168,000.00 333,200.00 415,230.88 419,569.12 34,964.09 19%

COC NIM ER GRM DCR 9% 1.60% 9.89 33.00% 6.60 1.05 15% 7.19% 8.34 32.21% 5.65 1.25 20% 12.80% 7.21 31.37% 4.95 1.45

COC NIM ER GRM DCR 21% 13.64% 7.07 30.00% 4.95 1.48 29% 21.28% 5.99 29.16% 4.24 1.74 36% 28.92% 5.19 28.53% 3.71 2.01

A rental analysis has been provided as an example only. It includes a number of assumptions that have a material impact. It should be

assessed carefully and a rental analysis specific to your circumstances and objectives should be undertaken. We recommend you obtain appropriate legal and technical advice before buying property.

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FINANCIAL FORECAST

Property Purchase Price ₱ 4,334,000.00 Settlement Property Growth and Property Value Capital Growth 4,334,000 Property Market Value 4,604,000 TOTAL Property MARKET VALUE 1

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15 YEAR FORCAST 6

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6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 6% 4,594,040 4,869,682 5,161,863 5,471,575 5,799,870 6,147,862 6,516,734 6,907,738 7,322,202 7,761,534 8,227,226 8,720,860 9,244,111 9,798,758 10,386,683 4,594,040 4,869,682 5,161,863 5,471,575 5,799,870 6,147,862 6,516,734 6,907,738 7,322,202 7,761,534 8,227,226 8,720,860 9,244,111 9,798,758 10,386,683

3,250,500 3,657,238 47% 1,930,303 7,721,213

970,979 1,000,109 1,030,112 1,061,015 1,092,846 1,125,631 1,159,400 25.2% 24.4% 23.7% 23.0% 22.4% 21.7% 21.1% 18.13% 17.61% 17.09% 16.60% 16.11% 15.64% 15.19%

3,250,500 4,071,702 44% 2,241,151 8,964,605

75%

3,250,500 3,266,234 50% 1,637,050 6,548,201

942,698 20.5% 14.74%

3,250,500 7,136,183 31% 4,539,512 18,158,050 3,250,500 2,897,362 53% 1,360,396 5,441,585

915,241 19.9% 14.32%

3,250,500 6,548,258 33% 4,098,568 16,394,273

3,250,500 2,549,370 56% 1,099,402 4,397,609

888,584 19.3% 13.90%

3,250,500 5,993,611 35% 3,682,583 14,730,333

3,250,500 3,250,500 3,250,500 3,250,500 3,250,500 1,083,500 1,343,540 1,619,182 1,911,363 2,221,075 59% 63% 67% 71% 75% 853,181 620,898 401,762 195,030 202,500 780,120 1,607,047 2,483,590 3,412,725 810,000

862,703 18.7% 13.49%

3,250,500 5,470,360 37% 3,290,145 13,160,579

837,575 18.2% 13.10%

3,250,500 4,976,726 40% 2,919,919 11,679,678

813,180 17.7% 12.72%

3,250,500 4,511,034 42% 2,570,650 10,282,602

789,495 17.1% 12.35%

Loan and Equity Loan Amount Equity in Property LVR (Loan to Value Ratio) LVR for Finance Buying Power

766,500 16.6% 11.99%

9.5% 36,025 379,206 373,458 65,556 305,155 25,430

Rental Income Annual Rent Gross Yield Net Yield

9.5% 68,924 346,307 362,581 63,646 284,173 23,681 9.5% 195,247 219,984 312,766 54,902 188,081 15,673

9.5% 98,969 316,262 352,020 61,792 263,802 21,983 9.5% 214,332 200,898 303,656 53,303 170,509 14,209

9.5% 126,407 288,824 341,767 59,993 244,024 20,335 9.5% 231,762 183,469 294,812 51,750 153,448 12,787

9.5% 151,465 263,766 331,813 58,245 224,823 18,735 9.5% 247,679 167,552 286,225 50,243 136,885 11,407

9.5% 174,349 240,882 322,148 56,549 206,180 17,182 9.5% 262,216 153,015 277,888 48,780 120,804 10,067

52% 26% 5.51 32% 3.74 1.89

9.5% 275,491 139,740 269,794 47,359 105,191 8,766

48% 24% 5.68 32% 3.85 1.84

9.5% 287,615 127,616 261,936 45,979 90,033 7,503

44% 22% 5.85 32% 3.97 1.78

9.5% 298,686 116,545 254,307 44,640 75,317 6,276

41% 21% 6.03 32% 4.08 1.73

9.5% 308,798 106,433 246,900 43,340 61,029 5,086

38% 20% 6.21 32% 4.21 1.68

Cash Deduction Loan Interest Rates Interest Only Principal Repayment Annual Property Expense Real Property Tax After-tax Cash Flow per Annum After-tax Cash Flow per Month

Investment Analysis 35% 32% 29% 27% 24% 22% 20% 18% 16% 15% ROI on Rental Property 18% 16.7% 15.4% 14.1% 12.9% 11.7% 10.5% 9.4% 8.3% 7.2% Cash on Cash (COC) 6.39 6.58 6.78 6.99 7.20 7.41 7.63 7.86 8.10 8.34 Net Income Multiplier (NIM) 32% 32% 32% 32% 32% 32% 32% 32% 32% 32% Expense Ratio (ER) 4.33 4.46 4.60 4.74 4.88 5.02 5.17 5.33 5.49 5.65 Gross Rent Multiplier (GRM) 1.63 1.59 1.54 1.49 1.45 1.41 1.37 1.33 1.29 1.25 Debt Coverage Ratio (DCR) Disclaimer: The figures in this report above are an estimation based on a complex range of factors and cannot be relied on for exactness. Always use a qualified accounting specialist before

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RENT COMPARABLES

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SALE COMPARABLES

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PRICELIST

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EXPRESSION OF INTEREST

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GLOSSARY Cash on Cash (COC) is a rate of return often used in real estate transactions that calculates the cash income earned on the cash invested in a property. It is equal to the Before Tax Cash Flow (BTCF) divided by the sum of all out-of-pocket aquisition costs (down payment, closings costs, etc.).

Gross Rent Multiplier (GRM) Purchase price divided by the Gross Income. The lower the number the better. it is the number of years the property would take to pay for itself in gross received rent. For the investor looking to purchase, a higher GRM (perhaps over 12) is a poorer opportunity, whereas a lower one (perhaps under 8) is better.

Debt Coverage Ratio (DCR) The Net Income divided by the Annual Debt Service. The higher the DCR the better. A DCR below 1.0 means the property is generating a negative cash flow. A DCR above 1.2 is considered to be a good cash flowing property.

Net Income Multiplier (NIM) The purchase price divided by the Net Income. The lower the NIM the better. The Multiplier tells you how effective the apartment building is at generating income compared to its market price. Using the Net Income Multiplier in this way gives you some valuable information when you are comparing apartments prior to a purchase.

Expense Ratio (ER) Total Operating Expense divided by Gross Income, expressed as a percentage. A percentage below 35 is considered good. Lower ER typically means the property is being managed efficiently and is more profitable for investors, and that less of the property’s income is covering operational and maintenance costs. If the business is scalable, the owner may increase the rent on each unit without greatly increasing operating expenses. In addition, the ER can show where potential issues may occur, such as utility bills increasing substantially, so investors can solve problems more quickly and protect their profit levels.

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