Holiday Destination: Slovenia’s Coast

Executive summary
Due to the global financial crisis, NFD Holding has decided to dispose of its portfolio of hotel properties on Slovenia's Coast at a discount. There are three properties in excellent beachfront locations, as follows:

1) Metropol Resort, Portorož - Portorose:
Grand Hotel Metropol: 5-star, 103 keys, refurbished June 2010
Hotel Lucija: 3-star, 182 keys, renewed and enlarged in 2008
Hotel Roža: 3-star, 111 keys
Hotel Barbara: 3-star, 65 keys

2) San Simon Resort, Izola -Isola (8 small hotels):
3 and 4-star, 225 keys, 44 rooms in Hotel Mirta refurbished 2008

3) Salinera Resort, Strunjan:
Hotel Salinera: 4-star, 101 keys, refurbished 2006
Vila Maia: 3-star, 9 keys, refurbished 2006
Apartments Salinera: 3-star, 76 keys
 
Current status
The hotels are running successfully, operated and managed by the Bernardin Hotels Group. The Slovene coast enjoys a high level of occupancy, at over 60% on average annually. The most important markets are Italian, German and Slovene.

Investment opportunity
There is an opportunity to acquire these hotel properties at a discount. This is an excellent opportunity to acquire a significant share of the hospitality market on Slovenia's coast. It is possible the performance of the hotels could be improved by more intensive and targeted marketing.

Investment required
EBIT DA* 2009 of the properties is as follows:

Metropol Resort:   EUR2.88m
San Simon Resort: EUR1.64m
Salinera Resort:  EUR1.35m

*- excluding cost of services from parent company such as  accounting, legal.dep, S&M.

2009 was down approximately 10% due to the global financial crisis, and 2010 is expected to be similar to 2009.

The owners are interested in receiving offers in the region of 63m euro which is approximately 15% below the appraised value carried out in July 2009.

Likely percentage of bank finance available
Local or international banks would likely finance approx. 30-60% of the purchase.

Advantages
Opportunity to establish a strong presence in the hospitality industry on the Slovenian coast, by acquiring three key properties at a discount, and improving the value by increasing revenue and profitability, which would be of long term benefit and value to the investors.