zarena ski apartments pamporovo,...

Zarena Ski Apartments Pamporovo, Bulgaria

a unique investment opportunity in Pamporovo, Bulgaria

investment guide

ONLY 30% DOWNInterest Only Finance &

Guaranteed Rental PackageLuxury 5 Star Hotel &

Ski Apartments

watch your investment snowballContents

chapter 1: opportunity i. finance package ii. introducing the 5 star Zarena complex iii. why invest in Bulgaria iv. Pamporovo - Bulgaria’s most beautiful ski resort v. EU membership

chapter 2: return on investment i. return on investment ii. room rental pool system iii. comparative rental income iv. projected return on investment

chapter 3: the risks i. risks & mitigations

chapter 4: the exit i. the exit routes ii. taxation guide

chapter 5: frequently asked questions

The luxury Zarena complex combines a 5-star hotel with stunning off-plan apartments for sale. Both meeting high international standards in architecture and construction, with the highest quality interior, on-site facilities and services provided.

The complex is beautifully located on the side of a picturesque hill, facing the Snejanka peak, the ski tracks, as well as the nearby observatory in Rojen, and the Southeastern slopes of the mountain. The attractive off-plan apartment complex and adjacent hotel will offer property owners and guests a range of luxury 5 star facilities, coupled with beautiful and unique panoramic views.

watch your investment snowballIntroducing Zarena - Luxury 5 Star Apartments in Bulgaria

Only 30% deposit and then nothing to pay for construction period plus the first 3 years after completion

Interest only finance

Guaranteed rental

No finders fee

High anticipated capital growth

Investment Highlights

chapter 1

opportunity

opportunity

You pay 30% deposit on the purchase price

Nothing to pay for the whole construction period

5 Years interest only finance repayments

Guaranteed Rental for first 3 years

Rental program managed by the established and successful Oasis Group to cover the first 3 years finance payments

The Perfect Finance Package

the perfect finance package

guaranteed rental

You only pay 30% deposit to secure your apartment and then pay nothing further during the construction period. Your furniture pack is included in the price. The first 5 years after completion you repay an interest only finance. However this finance is covered by a guaranteed rental for the first 3 years.

In that time you can expect significant capital growth on your apartment aswell as an increase in tourism levels and thus the rental yield you gain from the apartment. This is a unique investment in Bulgaria with a genuine finance package already in place.

This is illustrated clearly on the next page >

This model eliminates the need to for you to make stage payments during the build phase.

Year 1. 30% depositZarena apartments are under construction

Year 2: Zarena apartments are under construction You pay nothing further

Year 3: Interest only finance offset by a guaranteed rental



Your total investment stake in the first 5 years:

your investment

€30,000

€0

construction period

€0

€0

€0

€30,000

€30,000

The Finance Deal Explained

Example casestudy: Apartment at €100,000 with a 30% deposit with a construction period of 2 years

Disclaimer: please note, this is an example using a €100,000 apartment and a 2 year construction period to aid simplicity. Your investment will be dependant upon the price of the apartment you purchase and the remaining construction period will be dependant upon the time at which you buy. The construction period may be less than 2 years.

Zarena is surrounded by beautiful pine trees

All apartment users benefit from the use of the luxurious facilities available in this international standard 5 star hotel. Swim in the indoor pool, relax in the sauna or the steam rooms, revive yourself with a full body massage or enjoy a hydro-massage.

Also available are dedicated relaxation zones, aromatherapy treatment rooms, a children’s pool, table tennis, billiards hall and electronic games, artificial hiking wall, fitness centre, cosmetic centre, beauty salon, solarium, and other treatment rooms.

The 5-star complex will offer a superb range of hotel dining facilities:

Lobby-bar, Vienna café, a top floor restaurant with magnificent views, 230 seat main restaurant, large pool bar, a specialist Bulgarian BBQ restaurant, and winery with bar and wine tasting section.

In addition, entertainment, medical and treatment services, a children’s room and an Internet area are available.

At the disposal of the skiers there will be a ski checkroom and a ski workshop, with daily transport to the ski pistes provided. During the summer season there will be excursions and mountain biking as well as trips to the cultural and historical sites of the Rhodopa mountain, like the Rojen observatory, the Trigrad gorge, the Devil’s Throat cave and many other attractions.

Onsite retail outlets will include a perfumery, souvenirs, cosmetics, newspapers and magazines, drugstore, beverages, groceries, clothing and sports goods.

Apartment owners have exclusive access to ski mobiles and include 2 mountain bikes for each apartment.

The perfect environment for relaxation & endulgment for holiday makers

5 star luxury hotel

artists impression of one Zarena’’s saunas

5 star luxury hotel

Luxury Interior

Each Zarena apartment will be built and finished to a high internal specification. Features include a wood burning fire, a telephone, and a TV with satellite channels. The bathrooms will be equipped with luxurious faience tiles, a bathtub, and a shower cabin. Each apartment will have access to a balcony, offering a wonderful view of the sea of pine trees and the mountains.

Modern furniture packages are available and are incluced in the price.

why invest in bulgaria

High tourism growth

Favourable climate

High capital appretiation potential

EU Membership since January 2007

Bulgaria is a member of NATO

Low cost of living

All year rental season for mountain, luxury spa activities & ski holidays

Why is Bulgaria an Attractive Investment

The Property Market In Bulgaria The Bulgarian property market today continues to grow in accordance with expert forecasts. Property prices in some locations have risen to more than 30% per annum – one of the highest rates in the world and even now it still far exceeds many other European markets.

Now that Bulgaria is establishing itself on the foreign property market, it is shifting construction emphasis towards higher quality, exclusive developments. Only projects of the highest quality in terms of design, specification, construction and location are being considered. Permission for construction will be granted only if the developer can highlight a minimal effect to the environment. Protection of areas of natural beauty is paramount while protection orders have already been placed on National Parks. In Pamporovo, for example, no more build licenses are being issued at present, giving investors at the 5 star Zarena development strong growth potential and a solid exit strategy via the resale market that should avoid over supply.

opportunity

pamporovo

All ski runs are safeguarded and maintained to an excellent standard. The ski school centre is one of the best in Europe with more than 100 highly qualified ski instructors fluent in several languages teaching both beginners and advanced skiers.

Pamporovo is famous for its 156m high TV tower at the top of the Snejanka Peak. The elevator will take you to the cafe (93 m high) where you can enjoy the breathtaking view – the Rhodopes, the slopes of Rila Mountain and even the Aegean region.

The rental potential extends throughout the whole year

pamporovoPamporovo is also a very popular summer resort, often referred to as a ‘mountains and lakes’ resort with a range of activities to enjoy including guided walking and cycling tours. Tennis courts, horse riding and hiking are also available. The unique climate, strongly influenced by the nearby Mediterranean Sea, is extremely healthy and provides excellent conditions for climatic therapy and health tourism all year round.

Pamporovo is very popular with the the more afluatent Bulgarian executives as a more luxurious, 5 star spa resort in comparison to Bansko.

“Pamporovo enjoys no less than 250 sunny days throughout the year.”

In February 2005 the Bulgarian Parliament voted the Pamporovo resort to be a tourist area of national importance. The main benefit here is that the beautifully natural surrounds will be preserved intact with very little residential construction being allowed at present.

year round season

The rental potential extends throughout the whole year

opportunity

Bulgaria voted 2nd

“Hottest Destination for 2007”Expedia.co.uk has revealed the top ten holiday hotspots for 2007, as voted for by Expedia customers.Top of the list are the far-flung, up-and-coming destinations of Cape Verde, Brazil and Vietnam, along with European newcomer Bulgaria and popular Croatia. The hotly tipped list sees travellers branch-ing out from traditional destinations such as Paris and New York and choosing more adventurous spots for the year ahead.

The ‘Hottest Destinations for 2007’ list reveals Expedia.co.uk customers’ predictions for the travel hotspots for the year ahead, based on the results of a recent poll.

Expedia.co.uk’s Top 10 Destinations for 2007 1. Cape Verde2. Bulgaria3. Brazil 4. Vietnam 5. Croatia6. Cape Town 7. Devon8. Beijing 9. Las Vegas10. Morocco

Hotly tipped Bulgaria is also set to draw in increasing numbers of visitors with a beautiful coastline, reasonable prices and a wealth of cultural attractions and historical sights.

source: www.expedia.co.uk


opportunity

EU membership

Bulgaria joined the EU in 2007. As an EU member state, Bulgaria takes full advantage of its geographical position in the far east of the European Union, offering greater employment opportunities to its already highly educated workforce. Bulgaria now utilizes the considerable infrastructure and general expertise available within the EU to enhance its own economic development at all levels. Having already benefited from high levels of EU aid prior to its accession, being a full member now ensures the continuing flow of aid, to bring the country’s infrastructure to the same level as other member states. Between 2007 and 2009 Bulgaria will receive 4.6 billion euros from the EU, the highest figure per capita ever given to any EU accession country. This fact only adds to the already positive prospects for the development of Bulgaria. The huge strides that are being made with EU aid are already plain to see with, amongst other measures, the construction of a major new highway linking Bulgaria with other member states to the west, north and south.

Most importantly, being an EU member has brought considerable stability to Bulgaria, ensuring it will never again return to the economic mire which it found itself in post-Communism. Any remaining weaknesses in its economy are being finally eradicated and property prices will continue to respond accordingly. Examples of the same trend can be found if you study figures immediately after accession to the EU by countries such as Hungary, Poland, Czech Republic, Cyprus and Malta.

Also, the increased economic stability that working with the EU brings also means reduced interest rates, resulting in more affordable mortgages – interest rates were 15% five years ago. Another sign of a healthy economy is the fact that big businesses are setting up offices in Sofia, Bulgaria’s capital – including Microsoft, Pricewaterhouse- Coopers and Deutsche Bank – and to a lesser extent, in Varna, close to the Black Sea coast. This has an impact on the housing market, as it sees a shift from a rural economy to a more urban-based one resulting in a hugely-expanding population in Sofia, and an emerging middle class.


Bulgaria joined the EU in January 2007

chapter 2

return on investment

Return on Investment Despite excellent growth figures experienced over the past decade, Bulgaria continues to offer comparatively very low property prices. Other nations in Eastern Europe who are seen as competitors are becoming increasingly expensive, ensuring Bulgaria an ongoing competitive advantage despite rises in property values.

It is interesting to note that upon joining the European Union, the cities of Warsaw (Poland), Prague (Czech Republic) and Bratislava (Slovakia) all climbed more than 10 places in the “Mercer Cost of Living” survey.

The property investment market in Bulgaria has been heavily reliant on tourism for creating strong capital growth and high rental yield possibilities in the skiing and coastal resorts. This reliance is reciprocated however, with tourism being reliant on a thriving property industry to cater for demand. These industries are firmly set to continue to grow hand-in-hand.

The most recently identified demand in Bulgaria is for secure, luxury developments and the end of 2006 brought a great increase in purchases from reputable developers for higher quality build constructions.

Bulgaria - an Intelligent Property Investment

Early stage of development in Bulgaria, ideal time to invest »

Huge tourism growth potential. Increase of 50% between 2000 and 2004 (90% increase from EU »visitors)

Tourists expected to exceed 20 million by 2010, making it one of the world’s greatest emerging »tourism markets

Stable government committed to economic reform »

Large amounts of foreign direct investment and establishment of large multinational corporations »

Recent membership of the EU and continued, strong EU funding »

Excellent property prices that are very low compared to most other European locations »

Considered one of the most rapidly advancing countries in Europe »

Property construction emphasis on high quality design and build with minimal environmental »impact

The highest GDP growth in Eastern Europe (Institute of International Finance) at 6% for 2005/2006 »

return

return

room rental poolRental PoolYour rental income is guaranteed for the first 3 years after completion. Beyond this period there may be the option of pooled rental system.

Here is how a rental pool works:

Rental income from the rooms will be pooled by the hotel. This means that you do not have to worry about your own room always being let out. They are viewed as a single entity by room type. All the income from the 1 bedroom apartments is pooled and all the income from the 2 bedroom apartments is pooled. This income will be split between the investors and the hotel.

This great model removes the hassle and responsibility typically associated with finding renters for your individual apartment and moves it to hotel. As mentioned before, the hotel will be managed by The Oasis Chain of Hotels who already have strong relationships with Balkan holidays, and other leading travel agents across europe.

Disclaimer: This pooled rental system is yet to be confirmed and is one possible option for rental management after the guaranteed rental period.

room rental pool

Comparative Hotel prices per night in Pamporovo

Orlovetz***** (Winter Season 2007/2008)

LOW SEASON (15 DEC - 21 DEC 2007; 12 JAN - 01 FEB 2008; 16 FEB - END OF SEASON)

Single room 59 € EUR Twin room - per person 45 € EUR

MIDDLE SEASON (22 DEC - 28 DEC 2007; 05 JAN - 11 JAN 2008; 02 FEB - 08 FEB 2008)


HIGH SEASON (09 FEB - 15 FEB 2008)


Belmont**** ( Winter Season 2007/2008)

LOW SEASON (05 JAN - 25 JAN 2008; 23 FEB - 15 APR 2008)

Single room, HB 39 € EUR Twin room, HB 58 € EUR

MID SEASON (22 DEC - 28 DEC 2007; 26 JAN - 22 FEB 2008)

Single room, HB 48 € EUR Twin room, HB 70 € EUR

HIGH SEASON (29 DEC 2007 - 04 JAN 2008)Single room, HB 82 € EUR Twin room, HB 120 € EUR

Murgavetz**** ( Winter Season 2007/2008)

LOW SEASON (12 JAN - 01 FEB 2008; 23 FEB - 01 APR 2008)

Single room, HB 47 € EUR Double room, HB 70 € EUR

MIDDLE SEASON (22 DEC - 28 DEC 2007; 05 JAN - 11 JAN 2008; 02 FEB - 22 FEB 2008)


HIGH SEASON (29 DEC 2007 - 04 JAN 2008)


Bulgaria Property Index - (REMI) - Sale Pricesource: ADIS Ltd www.adis.bg

Purchase Price € 100,000

Deposit € 30,000

Lease amount € 70,000

Average Capital Growth % per year Year 1 2 3 4 5 6 7

5%Property Value € 105,000 € 110,250 € 115,763 € 121,551 € 127,628 € 134,010 € 140,710

10%Property Value € 110,000 € 121,000 € 133,100 € 146,410 € 161,051 € 177,156 € 194,872

Previous 3 year average 22.6%Property Value € 122,600 € 150,308 € 184,277 € 225,924 € 276,983 € 339,581 € 416,326

30%Property Value € 130,000 € 169,000 € 219,700 € 285,610 € 371,293 € 482,681 € 627,485

Lease Interest Rate 7% 7.25% 7.50% 7.75% 7.75%

Guaranteed Rental Yield 7% 7.25% 7.50% 7.75% 7.75%

Estimated Rental Yield 6.00% 7.00%

MilestoneBuild Finished

Interest Only, Guaranteed Rental



Interest Only

Interest Only

Costs

Deposit € 30,000 € 0 € 0 € 0 € 0 € 0 € 0

Buying Costs € 2,000 € 0 € 0 € 0 € 0 € 0 € 0

Interest payment € 0 € 0 € 4,900 € 5,075 € 5,250 € 5,425 € 5,425

Total Costs € 32,000 € 0 € 4,900 € 5,075 € 5,250 € 5,425 € 5,425

Income

Rental Yield € 7,000 € 7,250 € 7,500 € 6,000 € 7,000

Conservative Estimate 10%Capital growth € 10,000 € 11,000 € 12,100 € 13,310 € 14,641 € 16,105 € 17,716

Total Income € 10,000 € 11,000 € 19,100 € 20,560 € 22,141 € 22,105 € 24,716

Total Income € 129,622

Total Costs € 32,000

Profit € 97,622

your projected returnExample casestudy: Apartment at €100,000 with a 30% deposit with a construction period of 2 years

Disclaimer: please note, this is an example using a €100,000 apartment and a 2 year construction period to aid simplicity. Your investment will be dependant upon the price of the apartment you purchase and the remaining construction period will be dependant upon the time at which you buy. The construction period may be less than 2 years.

Bulgaria Property Index - (REMI) - Sale Pricesource: ADIS Ltd www.adis.bg

Purchase Price € 100,000

Deposit € 30,000

Lease amount € 70,000

Average Capital Growth % per year Year 1 2 3 4 5 6 7

5%Property Value € 105,000 € 110,250 € 115,763 € 121,551 € 127,628 € 134,010 € 140,710

10%Property Value € 110,000 € 121,000 € 133,100 € 146,410 € 161,051 € 177,156 € 194,872

Previous 3 year average 22.6%Property Value € 122,600 € 150,308 € 184,277 € 225,924 € 276,983 € 339,581 € 416,326

30%Property Value € 130,000 € 169,000 € 219,700 € 285,610 € 371,293 € 482,681 € 627,485

Lease Interest Rate 7% 7.25% 7.50% 7.75% 7.75%

Guaranteed Rental Yield 7% 7.25% 7.50% 7.75% 7.75%

Estimated Rental Yield 6.00% 7.00%

MilestoneBuild Finished




Interest Only

Interest Only

Costs

Deposit € 30,000 € 0 € 0 € 0 € 0 € 0 € 0

Buying Costs € 2,000 € 0 € 0 € 0 € 0 € 0 € 0

Interest payment € 0 € 0 € 4,900 € 5,075 € 5,250 € 5,425 € 5,425

Total Costs € 32,000 € 0 € 4,900 € 5,075 € 5,250 € 5,425 € 5,425

Income

Rental Yield € 7,000 € 7,250 € 7,500 € 6,000 € 7,000

Conservative Estimate 10%Capital growth € 10,000 € 11,000 € 12,100 € 13,310 € 14,641 € 16,105 € 17,716

Total Income € 10,000 € 11,000 € 19,100 € 20,560 € 22,141 € 22,105 € 24,716

Total Income € 129,622

Total Costs € 32,000

Profit € 97,622

your projected return

chapter 3

the risks

the risks

A lot of people have thought at some point about buying property overseas. The possibility of high returns for a relatively small real investment is a major attraction to any investor. The main reason the majority of people don’t invest more seems to be that the whole process seems too high-risk and they feel the legal and the paper-work end of things requires some special qualification.

The main risks in investing in overseas property are typically:

the risksWhat are the risks involved?

The future of the tourism market

Who is the developer and how experianced are they?

How reliable is the property agent?

The correct legal checks

What is the exit strategy - how can I “cash in” on my investment?

(The exit strategy is covered in Chapter 4)

the risks

the risks

The capital growth and ongoing rental yield will depend largely on the future of the tourism market. Bulgaria’s EU accession is already increasing its popularity as a tourist destination. Investments in the tourism sector are expected to increase while the Bulgarian Government’s spending on tourism is seen as to increase also. Pamporovo is a 5 star luxury ski (and all season) resort.

Forecasting Bulgarian tourismThis was forecast by a leading British online tourist company Direct-holidays.co.uk, as quoted by Bulgarian news agency BTA on March 9 2007. According to the company, the number of tourists to Bulgaria this year will increase by 10 per cent and will reach a total of 5.6 million.

Bulgaria’s EU accession is increasing its popularity as a tourist destination. The British company has hired consultants acquainted with Eastern Europe, as it expects increased interest to the region. The sales manager of Direct-holidays.co.uk, Alex Pilkington, said that tourism in the Balkans was growing fast as the price-performance ratio of the product was very good compared to Western competitors. Tourists held that holidays in the Balkans offered the best prices for tourist products both in summer and winter. According to Pilkington, Bulgaria offered the cheapest holidays in continental Europe so far, with Borovets and Pamporovo being the most popular resorts. The budget airlines also contrib-uted to tourists being attracted to the country. Due to the competition among them, prices were expected to drop even more, the British company said.

The chairperson of the National Hospitality Management Club, Iliyan Ivanov, told a news conference on March 9 2007 that by 2016, the tourist sector would account for 16 to 16.4 per cent of Bulgaria’s GDP. World Tourism Council researchers expected a 3.9 per cent annual increase in revenue from foreign tourists, and a 5.3 per cent increase in revenue from Bulgarian tourists in Bulgaria and abroad. Investments in the sector are expected to go up by 3.7 per cent while the Bulgarian Government’s spending on tourism is seen as likely to increase by 3.3 per cent. Currently, tourism accounts for 14 per cent of GDP. It provides for 140 000 jobs. During the summer season, employment increases.

future tourism

the risks

Increasing number of tourists to visit Pamporovo in 2008Preliminary contracts of main tour operators in Pamporovo winter resort for the season 2007-2008 showed that the number of tourists increase by 20 to 30 per cent as compared to figures for season 2006-2007. Almost all tourism agencies applied for more places next season, hotel-owners organisa-tion Pamporovo 21 Century said as quoted by Bulgarian news agency BTA.

Some tour operators even doubled the number of places they applied for as compared to winter season 2006-2007. The interest of UK and Irish tour operators in Pamporovo remained high as usual and the number of Russian tourism agencies interested in the resort increased, BTA said.

source: The Sofia Echo, 20th February 2007

Sustainable Tourism For Bulgaria to achieve it’s tourism goals, tourism must be well-planned and managed. It must be socially, culturally, and environmentally responsible. The Bulgarian authorities have designed it to achieve maximum benefits to local communities and integrated within national policies and strategies for sustainable development.

The world has seen far too many examples of the negative impacts of tourism. Unplanned tourism wastes resources or even destroys the environment. Foreign often companies benefit at the expense of local communities. Tourists sometimes offend locals with their behavior. In the Caribbean, it has been estimated that 80 per cent of all money spent by tourists leaks out of the local economy via foreign owned businesses and imports. Peru’s Machu Pichu, less than 100 years after its discovery, is already finding that it is far above its limit for sustainable usage. Spain’s Costa del Sol is perhaps the most famous example of the burden of over-development. There too much cheap construction drove tourists away, leaving locals with decaying infrastructure. Bulgaria is running these same risks with its tourism development. It is imperative for future tourism development to find an alternative that avoids these negative effects. Bulgaria needs sustainable, responsible tourism.

Sustainable tourism attempts to make a low impact on the environment and local culture while conserving local ecosystems and generating income and employment. It is responsible tourism that is both ecologically and culturally sensitive.

Sustainability implies permanence, so sustainable tourism includes optimum use of resources, including biological diversity. It seeks to minimize ecological, cultural and social impacts and to maximize the benefits of conservation for local communities. There are many examples of sustainable tourism. Globally it is becoming increasingly popular for tourists and tourism businesses alike to seek out sustainable alternatives in planning a trip. It is, however, important to realize no body is required to describe their business as “Eco-tourism” or “Cultural Tourism,” so these terms are often simply used as marketing buzzwords.

Some of the important characteristics of sustainable tourism include hosting smaller groups of travelers, which minimizes their impact on their destinations, hiring local employees and buying local goods and services to focus financial benefits in the community and educating tourists on local customs and ecology to increase awareness of sustainability issues.

about the developerThe developer, BG Realty, specialise in overseas property investment development. One of the leading specialists in tourism property in Bulgaria, BG Realty have a strong market knowledge with a vision to the future. Their dedicated team is highly qualified with a proven experience, offering their clients the highest quality personal services.

Their team consists of professionals with long-term experience in the field of property development, construction and sales. They have some of the best investment properties in Bulgaria carefully selected to provide clients with the highest capital appreciation and rental yield whilst providing a quality construction in a prime location.

Mrs. Elena Miliova (Director) – has experience as the Sales Director of Fort Noks - one of the biggest developers in Bulgaria - specialized in selling properties on the coast with more than 3000 property sales to date.Mr. Andrey Andreev – the Owner and Director of Dieci Group - is one of the most reputable developers and hotel owners in Bulgaria’s Sunny Beach region – renown for quality, concept, management, after sale’s maintenance and ongoing management of the projects. Mr. Andreev has substantial experience in the tourism, resulting in his high quality projects. The manager of the company Mr. George Andreev is a young ambitious businessman, educated in the UK, with a strong knowledge of economics and construction. hers make the development one of the best investment possibilities. Having one of the most attractive developments in its portfolio, one of the most stable and credible builders as part of the group and last, but not least the team of young deidicated professionals, all contribute to creating an atmosphere of harmony, where clients and partners can easily trust us, where all goals are placed and achieved, BG Realty Ltd. has reached a fame of a very desired partner for many companies.

Grand Hotel & Apartments Zarena ***** in the most elite ski resort in Bulgaria – Pamporovo is the newest pearl in our portfolio. Zarena is designed and planned as a modern and luxury 5-star development, meeting high international standard in architecture, construction, completion, interior, on-site facilities and services provided.

about the developer about the developer

BG Realty work very closely with the following developers. Dieci Group is the Developer and Manager of the popular Grand Hotel and Apartments Oasis ****.

in the heart of Sunny Beach, with a reputation as one of the best managed properties in Sunny Beach. In addition to the high quality services, the Hotel offers 7 years guaranteed rental income to the apartment owners.

Dieci group is a partner in the highly acclaimed Garden of Eden project, one of the pearls of the black sea with its traditional Bulgarian appearance, perched on a hill just on the beach of Saint Vlas. Dieci Group is also involved in leading projects in Bansko offering fully furnished apartments in a luxury 5 star development, with very high investment potential.

Mr. George Andreev is also involved in the development of The Vineyards SPA resort and Historical Park, with its wide range of unique facilities on-site. It boast it’s own Vineyards, Winery and gardens, Horse riding school, and wine museum. Features you cannot find elsewhere in Bulgaria surround a 5 star SPA hotel with extensive business and sport centers and more.

Floral roads Ltd. covers another important part of the BG Realty portfolio: Small Villa developments in the rural areas around Sunny Beach. BG Realty is a pioneer in this kind of development. The villas have a high investment potential.

The Floral Roads villas under construction in december 2006

Previous Developments

chapter 4

the exit

The importance of an exit strategyThe exit from an investment is just as important as choosing the right opportunity in the first place. Whatever capital gain is made over the period of ownership, you will need to be able to release that capital to realise the largest part of your profit.

There may be a number of exit strategies open to you and you will need to evaluate all of the options to determine the best one. A defined exit or a clear idea of your preferred strategy at the outset will help.

In the case of Zarena, there are a number of things to consider when defining your exit. Firstly, the ex-cellent rental potential, given its year round season could provide an ongoing yield that you are happy with, and you simply retain ownership of the property. However, to realise the benefit of the capital growth, you will need to sell outright and this is what the majority of property investors eventually do. A key factor to consider is the prevailing market conditions at the time at which you sell. This will dramatically influence the resale potential.

When a market is growing, it will be accompanied by a high number of new build developments, there-fore selling during a growth phase is difficult as your apartment has to compete with a number of other off-plan apartments that could generate automatic equity before they are finished.

Ultimately, a resale housing market is governed by the same economic laws as any other, supply and demand. Oversupply in a market will make it harder for everyone to sell.

Therefore, quality and scarcity play big roles in the exit. If your apartment is of a higher quality than its competitors in a resale market or is in a better location, it is more likely to sell as it is more scarce than other properties.

This offers Zarena a number of advantages. It’s location and quality inherently give it an advantage of other projects in Pamporovo, and there are no more build licenses being granted in the area at pres-ent which puts your investment in a very unique position. Additionally, other ski resorts in Bulgaria are currently experiencing higher build volumes that may limit exit potential. Pamporovo is very popular amongst affluent Bugarians, who favour the relaxing atmosphere above more westernised resorts such as Bansko. Therefore, selling in Pamporovo has the added benefit of appealing to locals.

In summary then, the exit strategy is one of the most important things to consider when buying prop-erty. Zarena’s excellent location on the slopes, and its high build quality and luxury feel will make it more appealing to potential buyers over many other projects. Similarly, the fact that no more build license are being issued there ensures that there will be no overdevelopment to limit the exit potential.

the exitthe exitthe exit

Taxation in BulgariaCorporate income tax in Bulgaria applies in a single rate of 10% on the annual profit of the respective company. From 1st January 2007 the corporate rate of tax was lowered from 15% to 10%. No separate capital gains tax exists in Bulgaria, but capital gains from transaction with properties are included in the calculation of the annual financial profit of the company, which is subject to 10% corporation tax.

The owner of a building or plot is obliged to pay an annual real property tax equal to 0.15%, together with garbage fee estimated separately by the different municipalities, usually at varying rates between 0.3 - 1.2%. The tax rate is charged on the book value of each property (for business properties of entities) or on the tax evaluation (for residential properties of entities and properties of individuals). Tax evaluations tend to be singificantly lower than market prices.

Transaction with agricultural land and lease of property for residential purposes to individuals are exempt from VAT. All other transactions with properties are considered as VAT taxable deals and are subject to VAT at 20% if the Seller is a VAT registered entity. Exceptions allowed for built-up properties for which more than 60 months have passed since right-to-use was issued.

Certain items of business and investment income of non-resident individuals and legal entities earned from sources in Bulgaria are subject to flat final income tax, which is normally levied by means of withholding. The domestic rate of withholding tax is 10%, except for dividends (7%).

The information provided in this section is indicative and general. All prospective buyers are thus advised to seek specific professional advice on the current and possible tax implications in this respect.

source: Bulgarian Government

Important:Please note we are not a tax advisor nor an accountant. The information is this section has been obtained from reliable sources, however, we strongly recommend you seek expert advice before proceeding with any purchase.

taxationtaxationtaxation

next steps

Step 1. Reservation form & Finance Application (£250 processing fee)

Step 2: Approval from NLB Bank

Step 3: Upon signing of the contract - 30% deposit

Step 4: Upon completion of the project - 70% finance

The Buying Process

frequently asked questions


1. What makes Zarena such a fantastic investment opportunity?

The Zarena Spa is a 5 star luxury complex and provides a fantastic investment opportunity for many reasons. Located in the heart of the emerging Ski resort of Pamporovo, the positioning is simply stunning, allowing those who use the resort excellent access to a vast array of activities both on and off the ski slopes.

The resort is being developed by a company with a proven track record and full due diligence has been conducted to ensure the safety of the investment for the UK public. Added to this are the excellent facilities on the complex and the resort itself, the infrastructure for airports/tourist areas, managed security, a guaranteed income and a concise finance package. Therefore we feel this complete package offers a remarkable investment opportunity.

2. What does the Ski resort of Pamporovo have to offer?

The Ski resort of Pamporovo sits at an altitude of 1650m, the highest point being the peak of Snejecka which has the impressive height of 1926m. The weather in the region provides an idyllic setting for skiing, offering 150-200 days a year of snow and 200 days of sunshine. The climate at the base of mountains is fairly mild making for excellent Apres Ski conditions.

The resort has 5 chair lifts and 13 tows lifts. These lifts have the capacity for up to 8500 people at anyone time, keeping queues and waiting times to a minimum.

The resort has 25 ski slopes. The tracks range from long cross country green runs to the more challenging “Grand Slalom” black run. This offers something for everyone, from the beginner or family to the more skilled skier. There is a full ski school for learners of all ages as well as a kindergarten ski school for the young.

3. In addition to the skiing what other activities can visitors participate in?

Pamporovo itself is famous for its 5 star facilities and luxury spa centres. The resort offers a sophisticated, safe and luxury holiday, making this an ideal location for family trips and relaxing breaks for adults.

In addition to the ski slopes and spa’s there are snowboarding runs, tobogganing areas, ice skating facilities, bowling alleys and of course plenty of bars and restaurants!! There really is something for everyone.

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4. On the Complex of Zarena, how many units are there in total?

The Complex has 60 units in total, 6 units have 2 bedrooms and the remainder have 1 bedroom.

5. Is the complex linked to a Hotel?

At the heart of this development is a luxury hotel. Attached to this hotel is the 43 apartment luxury units, it is these units that are for sale. They mirror the hotel in style and finish and purchases get full access to all Hotel facilities. So you get a private residential apartment with all the benefits of a luxury hotel.

6. What is the star rating of this development?

This is a 5 star hotel development built to International Standards, as opposed to the much lower Bulgarian standards.

7. What facilities are planned for the resort?

A full spa centre to include indoor swimming pool, sauna, steam rooms, massage centre, aromotherty treatment rooms, beauty salon and solarium. The site also has an internet area, medical centre, children’s pool, a 230 seat restaurant, large pool bar, lobby bar, Café and a Bulgarian BBQ restaurant.

The complex also has the unique feature of providing its owners with his and hers mountain bikes which are ideal for use in the warmer months to explore the breathtaking mountain scenery and use of snow mobiles for the winter months.

8. When is the development likely to be finished?

The entire resort will be fully operational by December 2008.

9. Who is managing the resort?

The Service/maintenance of the resort is handled by the Oasis Hotel Group, a well established hotel group in Bulgaria that has over 20 years experience in the hospitality industry.





10. How much is the maintenance charge?

For the first five years it is approximately €750 per annum for all apartments. This maintenance fee includes the upkeep of the common areas, upkeep of facilities, heating/lighting of the common areas, maintenance of green areas, use of swimming pools and facilities, use of the snow mobiles and all year round security.

11. Is there a rental guarantee?

There is a guaranteed rental scheme for all units and this breaks down as follows: Year one (commencing on completion of construction) offers 7% return, year two offers 7.25% return and year three offers a 7.5% return.

12. Can I use my property during the guaranteed rental period?

During the guaranteed rental period owners can use their property twice a year, once during the Ski season for a week and once in the off season, again for the duration of a week. So essentially buyers get the best of both worlds, a guaranteed income and a property to use as a holiday home!

13. What is the procedure for reserving a property at Zarena?

To Reserve the property of your choice you simply complete a Reservation Order Form which contains all the information the developer will require in order to compile your preliminary sales contract.

14. Do you have to put any money down in order to reserve a unit?

In order to hold your property a €2000 reservation fee is payable at this stage. This can be paid by credit card or via bank transfer.

15. At what stage after reservation does the buyer have to pay for the unit?

As is common in Bulgaria, off plan developments are paid in stage payments. The first installment on this development is 30% of the purchase price minus the reservation fee. This is due upon signing of the sales contract by both parties; the process from reservation to payment is approximately 6 – 8 weeks. The final 70% would then be due upon completion.



16. Is there a finance option available on these units?

The developer has put together a finance package to fund the remaining 70% payable for the buyer. So buyers only have to fund the first 30%! This is available on all units. The finance option breaks down as follows:• 30%payableuponsigningofthepreliminarycontract.• Uponcompletion,andforthefiveyearsthatfollowconstruction,thebuyerbeginstorepay the finance taken out on the unit.

17. Will the guaranteed rental offset the finance repayments?

YES. The guaranteed rental will offset and cover your repayments for three years after construction. So the buyer parts with nothing from the 30% deposit payment to the third year after construction.

18. How often is the rental pool income paid to the owner?

Monthly. The construction company then handles the administration involved with paying the finance repayments. So it is straight forward and hassle free for the buyer.

19. Will the buyer require a credit check for the finance?

Yes. A credit cheque is required. This is carried out in the UK by Complete Mortgage Solutions at a cost of £250.

20. What about legal advice?

It is not compulsory to use a lawyer for a property purchase in Bulgaria however we recommend that all buyers seek legal advice without exception. Interlink can recommend an independent lawyer that specialises in Bulgaria conveyance.

21. How much do legal services cost in Bulgaria?

The cost will depend on the package / services you choose but a concise package will normally cost around 800 – 1200 Euros.





22. Is the ownership of the apartment leasehold or freehold?

Freehold.

23. Does the property come furnished?

The apartment comes with a high quality furniture pack to compliment the attached 5 star hotel.

24. What happens in the event of damaged furniture? Whose responsibility is it to replace items?

The owner carries no responsibility for replacing damaged items; this remains the responsibility of the tenant and or management group.

25. What is included in the furniture pack?

This is a turnkey investment product - The furniture pack includes all bedroom furniture, sofa’s, coffee table, TV Unit, TV, Dining table and chairs, patio furniture, full fitted luxury kitchen, fully fitted bathrooms, kitchen white goods and hob, etc. The soft furnishings are not included in the price

26. Is flooring included in the furniture pack?

Yes all the apartments come with wooden flooring throughout and stone on the entrance.

27. What kind of security is offered on site?

This complex has 24 hour manned security.

28. Are the rooms heated?

All rooms are fitted with Hot/Cold air conditioning. The units also come with a traditional wood burning fire.

29. Which airlines fly there?

To Sofia: BG Air and British Airways fly daily and the low cost airline Wizz Air also fly’s 4 times



a week. Other frequent airlines are Lufthansa, Czech Airlines, Hungarian Airlines, and Balkan Tours. Flights are also running frequently to the expanding airport of Plovdiv – Balkan tours for example fly weekly from most hub airports such as Cardiff, Birmingham, East Midlands, Edinburgh and Liverpool.

30. Can a site visit be arranged?

Yes the agent offer 2 day visits for £199 per person from selected UK airports. These trips offer excellent value and the fee covers all flights, accommodation airport transfers in resort. These trips are accompanied by a member of our team that has detailed knowledge of the project and the region of Pamporovo.

31. Who pays the utility bills during the guaranteed rental period?

The utility bills for your apartment will be paid by the hotel during the guaranteed rental period.

32. What about an exit strategy?

The exit strategy is one of the most important things to consider when buying property. Zarena’s excellent location on the slopes, and its high build quality and luxury feel will make it more appealing to potential buyers over many other projects. Similarly, the fact that no more build license are being issued at present ensures that there will be no overdevelopment to limit the exit potential.

All apartments have exclusive access to ski mobiles and include 2 mountain bikes for each apartment.


Zarena Ski Apartments Pamporovo, Bulgaria Zarena Ski Apartments Pamporovo, Bulgaria

Disclaimer:This information is and remains the property of Interlink. It is made available to the addressee subject to the standard terms and conditions of Interlink. These can be found by requesting a printed copy from our sales office.

The points that follow are an extract only and do not contain all relevant parts of the standard terms and conditions. Therefore they should not be relied on as the complete guide to the legal relationship between us. A copy of this Information is made available to you for your personal use and must not be given, shared or communicated with any other person except for your own professional advisors for the sole purpose of obtaining their advice. We endeavour to provide accurate up to date and complete information but makes no warranties or representations as to the accuracy, reliability or completeness or otherwise of the information contained herein. We assume no responsibility or liability for any omissions or errors contained in the information.

Descriptions Of Property, Homes, Buildings, Locations Or Developments Particulars, Specifications, Pictures and artists impressions of any property, home, building, location or development are given in good faith and believed to be correct, but they do not form part of any offer or solicitation and are intended only as a general guideWe do not control the building or development of any opportunity. You acknowledge that developers reserve the right to alter plans, designs and specifications at any time without prior notice. We therefore will not be responsible for any such changes. All descriptions are intended only as a general guide and are not to be relied upon by you or other interested parties as a statement or representations of fact but you should satisfy yourself by inspection or otherwise.

Investors are required to conduct their own due diligence and make their own judgement upon the investments being offered. Investors must verify the information and any speculative opinion offered by this brochure or Interlink. Investors are strongly recommended to perform their own financial and legal assessment of any opportunity prior to making any commitment to participate. Interlink does not provide or offer an opinion as to whether a particular investment is appropriate for a particular investor. Interlink only offers an opinion on the investment opportunity in general terms and in relation to the market as a whole.

Interlink has endeavoured to provide the highest quality information, backed up by substantial experience and proven evidence from the marketplace. However, individual interpretation of information may vary, and individual circumstances, skills, abilities, knowledge and attitude play an important part in achieving a particular outcome. In addition, the future behaviour of the property market may not follow past experience, either nationally or locally. For this reason Interlink does not warrant, guarantee or promise that you will make profit from any property transaction entered into, whether as a result of acting on information contained within this document or otherwise.

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