Luxury hotel with convention center in Villa Carlos Paz City (VCP)

Argentina

Luxury hotel with convention center in Villa Carlos Paz City (VCP) - Argentina

According to the international consulting firm Horwath HTL:

• Investment of U$D 30 million.

• High rate of hotel occupancy in VCP.

• Strong economy – increase of demand.

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OVERVIEW

• We will build the best luxury hotel with convention center in VCP. (one of the most important tourist cities in the country). VCP does NOT have a real luxury Hotel with convention center.

• The International consulting firm “Horwath HTL” (www.horwathhtl.com) has validated the market and the business plan.

• Government support • International luxury Hotel Chain support

Government support

• The Minister of Tourism of Argentina: Mr. Carlos Enrique Meyer

• The Minister of Tourism of the State of Cordoba: Lic. Gustavo Santos

• From the Major of Villa Carlos Paz: Ing. Carlos Felpeto

Cordoba State Law 7232Regime of Tourism Promotion and Development

(Tax Free)

International luxury Hotel Chain

• Francesco Cefalu: Development Director – South America Hilton Worldwide

• Eduardo Rodríguez Suárez: ACCOR Hotels – Latam Development

• Paul Adán: MARRIOTT DEVELOPMENT, VP International Hotel Development Caribbean and Latin American Region

Córdoba International Airport

Property view http://www.youtube.com/watch?v=ZQO4Ui-Tkjk&feature=related

http://www.youtube.com/watch?v=o4qH7xRR9Cw&feature=related

http://www.youtube.com/watch?v=RBD8bpRFm4w

Developed profile of VILLA CARLOS PAZ (VCP)

Location Strengths

Location Weaknesses

PROBLEM/OPPORTUNITY

VCP does NOT have a real luxury Hotel with convention center. • Our target buyer is wealthy people of the center of Argentina, which is

willing to pay a premium price for a REAL luxury, modern and full service Hotel with spa and also some international tourist since they are growing due last years.

Congress people target: there is not a good and modern facilities in VCP (surrounding for a beautiful nature environment).

An important info: Córdoba (30 km far away from VCP) is going to receive a big investment from China. “China Railway” company is going to built the first subway in Córdoba and the “China Exim bank” is going to finance the 85% of the project of a U$D 1.8 billion in total.

INTERNATIONAL TOURIST ARRIVALS

Total expenditure of international tourists

Forces driving new investments

Demand seasonality

Graphic synthesis

VCP conclusions

SOLUTION/PRODUCT

According to Horwath, we have two scenarios that both will include: • 2500 sq. meters of convention center.• 2 restaurants with 300 sq. meters each. • One theatre for 350 people. • One marina of 300 sq. meters. • Parking place of 4.200 sq. meters. • Total construction of 13.600 sq. meters. • Property features: It is more than 27.000 square meters (more than

6,67 acres). The difference between both scenarios would be:• 4 stars Hotel with 160 rooms.• Mixture between 4 stars and 5 stars hotel. The 4 stars hotel would

have 120 rooms and the 5 stars hotel would have 40 rooms.

Conclusions about the Feasibility of the project

POTENTIAL RETURN

According to Horwath:

A. 4 stars Hotel with 160 rooms: - Investment U$D 29,3 million - IRR is 13,5% - Time to recover the investment is 9.5 years

B. Mixture between 4 stars and 5 stars hotel. The 4 stars hotel would have 120 rooms and the 5 stars hotel would have 40 rooms:

- Investment U$D 31,7 million - IRR is 12,5% - Time to recover the investment is 9.5 years

However its analysis has very conservative assumptions from my point of view.

COMPETING HOTELS ON OFFER

Number of room by category

Current Convention Centers

Possible barriers to new investments

FINANCIALS

CEO: Daniel Salomon8 years developing businesses working as • Executive Director, Business Technology Incubator, FaMAF – UNC, • Application Sales Representative - Oracle Corporation Inc.Education: • Private Equity and Venture Capital Program - Harvard Business School - Tsinghua SEM• Entrepreneurship Development Program – MIT Sloan School of Management, USA• MBA - IAE Business School, Argentina / Darden Graduate School of Business, UVA, USA• Certified Public Accountant (CPA) - UNC, Argentina

COO: Architect José Gregorio Pisani• Co-Founder of GGMPU Architecture Firm• More than 30 years of experience in public and private big projects.• He has several publication in CPAU Argentina (professional consul of Architectures and

urban from Argentina)

CFO: with have two possibilities:- A person placed by the investor- A local experienced CPA of my trust and a placed auditor by the investor.

Management Team

GGMPU works has been published in national and foreign books and magazines and has been shown in domestic and foreign exhibitions. It has been awarded the main national distinctions and some international ones in the architecture field such as:

•2nd.Prize –Architecture Biennial of Quito-Ecuador, to Provincial Museum of Fine Arts Emilio Caraffa – 18 November 2008.

•1999 - The International Association of Family Entertainment Centers (IAFEC), at its Congress held in Las Vegas, awarded the Neverland Park of El Abasto Shopping, Buenos Aires the gold medal as the “Best Entertainment Center in the World”.

•In the 1995 Congress of the International Architects Unions, held in Barcelona, the Design Office’s work was the only argentine one invited to participate in the main exhibition.

•Towards the end of the year 1995, the Chilean Architects Professional Association -10th Architecture Biennial- awarded a prize because of the Nazaret III building.

•Vitruvio Prize ’94 (“Works that make History”) for “Nuevocentro Shopping”.

•Konex Visual Arts Prize (1992) to “One of the five best design offices of the former five years”.

GGMPUArquitectos

For your reference:

• My mentor is the Professor Silvia Torres Carbonell from IAE Business School of Argentina. She is well known in Latin America about entrepreneurship issues in our region (she has several interview in CNN about this issue). She is well known also; by Professor Kenneth P. Morse of MIT Entrepreneurship Center (I had him as a professor last year at MIT).

http://www.youtube.com/watch?v=STpQbTZA4wM

• Hugo Freytes: VP Strategic Sales ORACLE LATAM

• Carolina Florez: VP HR ORACLE LATAM

EXECUTION PLAN/GO TO MARKET STRATEGY

• Strategy: make a contract with an international luxury hotel chain like Hilton, Marriot or Accor in order to leave to them manage the business.

• We will be only shareholders and we will control the management with monthly meetings and checking the objectives that we negotiated previously.

• Horwath HTL will help us to negotiate the contract with the international hotel chain.

EXECUTION PLAN/GO TO MARKET STRATEGY

What’s next?:

1. Buy the property.

2. Hire Horwath and start negotiations with international hotel chain.

3. GGMPU architecture firm: start the design of the project.

4. Hire a lawyer in order to help us to prepare the contract with the construction company.

5. Hire the construction company.

6. Control the project according standards.

Questions?