UMACO Group Katerina Park Hotel Moscow Investment Memorandum Moscow
Introduction Offer Potential investor is offered to acquire a Cyprus company which owns Moscow 240-key Katerina Park hotel located in the south of the city, 11 Kirovogradskaya str., in rapidly developing Moscow office district. The hotel is an operating business with existing cashflow, which may increase over time through hotel demand increase and management improvement. Asking price: to be discussed Key figures Year built: 1987 Full reconstruction: 2010 Operating start: September, 2010 Vendor: UMACO Group Management Company:UMACO Management General Contractor: UMACO Development Land area: 5,594 sq.m GBA: 11,000 sq.m Tenure: Building freehold Land till March 23, 2031 Stabilized EBITDA: $ 5 million Location & Site map Prazhskaya metro station 0,5 km Yuzhnaya metro station 0,7 km Varshavskoe highway 1 km Kremlin & Red Square 18,8 km Vnukovo Airport 30 км Domodedovo Airport 37,4 km Sheremetjevo Airport 58 km
Property description Status: Built 1987 Full reconstruction 2008-2010 Areas: Guest rooms: Food & Beverages facilities: Conference & Meeting facilities: 12 floors above-ground + basement level Room area 5740 sq.m Management office 59 sq.m Lobby, public areas 105 sq.m Restaurant 200 sq.m Reception area 45 sq.m Kitchen 160 sq.m Fitness center 148 sq.m Technical services 830 sq.m (sauna, gym, relax area) Conference areas 312 sq.m Room type Rooms number Average room size MEDIUM Twin beds 118 20 21 sq.m MEDIUM King-size bed 102 21 22 sq.m LARGE 20 34 38 sq.m Total 240 Facility Location Capacity (seats) Main Restaurant Level 1 150 Reception / Lobby Bar Level 1 90 Total capacity 240 Room Area Capacity (seats) Bjork 128 sq.m 130 Gran 62 sq.m 75 Ronn 43 sq.m 40 Ek 25 sq.m 25 Coffee break area 54 sq.m Total 312 sq.m 270 Parking lots: Technical specifications: 100 outdoor parking lots on the secure land site adjacent to the hotel Precast concrete frame Heating, electric, sewage and water supply are provided by city utility companies Elevators 4 passengers elevators +1 food unit Fire protection fire alarm system throughout the hotel
Acquisition, Rebranding & Renovation terms Hotel development & renovation, realized by UMACO during February 2010 February 2011 ACQUISITION STEP December 2009 February 2010 UMACO signed the Letter of Intent December 17, 2009 Hotel Katerina Park bought by UMACO February 02, 2010 RECONSTRUCTION STEP 1 Main entrance & 1st floor March April 2010 Lobby & Reception area Lobby Bar Full reconstruction Full reconstruction Restaurant Full reconstruction Elevators hall Full reconstruction Katerina Park Grand Opening April 04, 2010 RECONSTRUCTION STEP 2 Conference floor creation (2nd floor) May July 2010 Bjork conference room New creation Gran conference room New creation Ronn conference room New creation Coffee break area New creation Katerina Park Conferences Grand Opening July 29, 2010 RECONSTRUCTION STEP 3 Basement level November December 2010 Fitness center Saunas and relax area, changing rooms New creation Gym room New creation Staff areas New creation New Guest Relax & New Staff Areas Official Opening December 20, 2010 Kitchen New creation January, 2011 Laundry storage New creation January, 2011 RECONSTRUCTION FINALIZED February 1, 2011
Hotel Renovation: Step 1 March April 2010. Exterior Yesterday Today
Hotel Renovation: Step 1 March April 2010. Reception area Yesterday Today
Hotel Renovation: Step 1 March April 2010. Lobby area Yesterday Today
Hotel Renovation: Step 1 March April 2010. Lobby bar area Yesterday Today
Hotel Renovation: Step 1 March April 2010. Restaurant Yesterday Today
Hotel Renovation: Step 2 May July 2010. Conference floor Elevators hall Coffee break area 54 sq.m Ronn 43 sq.m Gran 62 sq.m Bjork 128 sq.m
Hotel Renovation: Step 2 May July 2010. Conference floor A new brand conference floor: New building New design Conference rooms : 3 Total area: 320 sq.m Capacity: 240 pax Multifunctional: conferences, trainings, exhibitions banquets, weddings Innovative coffee break & relax area New technologies, powerful air-conditioning and ventilation systems Clever interior design inspiring productive meetings
Hotel Renovation: Step 3 November December 2010. Fitness center Yesterday Guest sauna Today 2 Saunas & Relax area
Hotel Renovation: Step 3 November December 2010. Fitness center Yesterday Stairs to the Fitness center Today Stairs to the Fitness center
Hotel Renovation: Step 3 November December 2010. Fitness center Yesterday Guest shower at sauna Today Shower in changing rooms
Hotel Renovation: Step 3 November December 2010. Fitness center A new Fitness center: New building New design Areas: - 2 saunas - Relax area - Changing rooms - Gym room
Hotel Renovation: Step 3 November December 2010. Staff areas New Staff areas & Kitchen: New building New design New staff areas: - Changing rooms - Shower rooms - Staff canteen - Staff stairs for employees safety News kitchen area: - Separate hot and cold kitchen rooms - Elevator for food between ground and 1 st (restaurant) floor - Stainless shelves, working tables and other necessary kitchen equipment
Interior design Today MEDIUM room Lobby Bar Reception LARGE room Restaurant Coffee break area Relax area, Fitness center Ronn room, 43 sq.m Bjork room, 128 sq.m
Executive summary Investment opportunity Opportunity to acquire a 4 star operational Katerina Park business-hotel of 240 keys located in the Moscow city business district. Key financial figures Type of the Property: 4 star Business Hotel Size of Property: 240 rooms The Target is located in a rapidly developing Moscow office segment (450,000 sq.m of office area in 5 km around Katerina Park) which has a capability to expand over the forthcoming years. Clean share purchase deal with established Cyprus holding structure. Estimate Purchase Price (VAT excl.) Stable operating figures: To be discussed Stabilization year 2014 GOP Margin 64% EBITA Margin 48% RevPar 124 USD ADR 188 USD Occupancy 66%
Site allocation 1 2 M Katerina Park hotel building (240 keys) Outdoor parking (100 places) Prazhskaya metro station 0,3 km Surroundings & Community A large city park is located just across the road for strolls Kirovogradskaya street 1 2 Varshavskoe highroad Many shopping and entertainment centers are within walking distance from the hotel A natural-historic park Bitsevsky forest, the second-largest specially protected natural site in Moscow, with the largest Bitsa horse and sport complex in Europe at 1,8 km distance Tsarytsino Open Air History and Architectural Museum at 2,9 km distance M M
Katerina Park Business district Gross office supply (existing and under construction) in the area 445,000 sq.m (mainly Class B+) in 5-km radius from Katerina Park 1 VARSHAVKA Sky (opening in Q1 2012) is a new multifunctional business and sports centre, located on the first line of Varshavskoye highroad only in 1 km from Katerina Park hotel, will provide office and retail areas for rent to a great number of Russian and foreign companies. 2 Varshavskiy Office Park 3 Business Park Solutions (office & retail complex) 1 2 5 6 4 5 6 Kharkovskiy Office & Warehouse complex Business Center Meridio Nakhimov Business Center 3 4 7 8 Platimum Business Center Office center m. Ulitsa Akademika Yangelya 9 Business center m. Anino 8 Other Office centers STUPINO Industrial Park is a rapidly developing industrial center of 606.55 ha total area. Located south of Moscow, it has investment potential for industrial and warehouse developers. 9 Key Tenants with manufacturing in Stupino: Mars Pepsi Scovo household products Kimberly Clark (factory is under construction) Keramogranit Campina Knauff
Competitors map Katerina Park Hotel Primary Competition 1 Milan 4* 4 2 3 4 Ibis Moscow Paveletskaya 3* Izmailovo 3* Kosmos 3* 7 5 Korston 3* 8 6 3 6 Holiday Inn Sokolniki 4* 7 Holiday Inn Sushevskiy 4* 8 Novotel Moscow Center 4* 5 2 Secondary Competition (hotels in the area): 1 Berlin 2* 4 3 1 2 2 3 4 Sevastopol 2* Bitsa 2* Eridan 2* 5 AGK Moskomsporta 2* 1 6 Rus-otel 2* 5 6
Katerina Park and Moscow Hotel Market dynamics 2010 Main hotel results 2010 My Property: Katerina Park Hotel #171877 Comp Set: Hotel Cosmos #132543, Korston Hotel Moscow #132628, Holiday Inn Moscow Suschevsky #139624, Holiday Inn Moscow Sokolniki #140504, Katerina Park Hotel #171877, Excludes Subject Property Currency: RUB - Russian Rubles Occupancy ADR RevPAR Date This Year This Year Last Year % Chg This Year This Year Last Year % Chg This Year This Year Last Year % Chg My property Comp Set Comp Set Comp Set My property Comp Set Comp Set Comp Set My property Comp Set Comp Set Comp Set Jan 2010 31 25 22 3122 4423-29 965 1117-14 Feb 2010 48 44 10 3318 4288-23 1600 1880-15 Mar 2010 49 43 15 3367 4290-22 1663 1848-10 Apr 2010 52 44 18 3189 4011-21 1662 1772-6 May 2010 62 47 32 2694 3704-27 1661 1734-4 Jun 2010 67 48 40 2744 3450-21 1840 1654 11 Jul 2010 57 47 23 2464 2861-14 1405 1330 6 Aug 2010 56 51 8 2384 2520-5 1326 1297 2 Sep 2010 66 79 61 29 2876 3047 3160-4 1904 2412 1937 25 Oct 2010 61 66 53 25 3198 3371 3447-2 1951 2236 1835 22 Nov 2010 64 61 44 38 3099 3453 3658-6 1968 2091 1607 30 Dec 2010 53 51 41 26 3247 3412 3462-1 1719 1739 1406 24 TOTAL 2010 61 57 46 24 3105 3031 3535-14 1886 1714 1615 6 This is a publication of STR Global Limited and is intended solely for use by subscribers. Reproduction or distribution of this report, in whole or part, without written permission of STR Global Limited is prohibited and subject to legal action. Site licenses are available. Ownership, distribution and use of the report and its contents are subject to the terms set forth in the contract you have entered into with STR Global Limited. Source 2011 STR Global, Limited
Katerina Park and Moscow Hotel Market dynamics 2011 Main hotel results 2011 My Property: Katerina Park Hotel #171877 Comp Set: Hotel Cosmos #132543, Korston Hotel Moscow #132628, Holiday Inn Moscow Suschevsky #139624, Holiday Inn Moscow Sokolniki #140504, Excludes Subject Property Currency: RUB - Russian Rubles Occupancy ADR RevPAR Date This Year % Chg Index This Year % Chg Index This Year % Chg Index My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set Jan 2011 36 28 91-13 129 3026 3589 17 14 84 1091 1003 123-1 109 Feb 2011 66 55 236 8 119 3320 3534 18 6 94 2181 1950 295 15 112 Mar 2011 76 53 165 4 142 3133 3597 19 6 87 2370 1914 214 10 124 Apr 2011 78 60 135 12 129 3003 3339 6 4 90 2336 2012 150 16 116 May 2011 81 58 225-11 140 2657 3089-19 16 86 2148 1784 162 3 121 Jun 2011 89 71 215 1 126 2672 2921-24 8 92 2389 2073 140 8 115 Jul 2011 83 56 148-5 149 2367 2648-19 9 89 1972 1481 101 3 133 Aug 2011 89 62 141 9 143 2390 2494-18 6 96 2118 1551 97 15 137 Sep 2011 93 77 40-5 121 3173 3302 10 8 96 2934 2528 54 3 116 Oct 2011 81 67 35 0 122 3000 3535-6 4 85 2439 2360 26 4 103 Nov 2011 69 59 8-2 116 3249 3748 5 8 87 2224 2210 13 5 101 Dec 2011 54 50 3-1 108 3463 3511 7 2 99 1882 1768 10 2 106 TOTAL 2011 75 58 94 0 129 2914 3249-4 7 90 2170 1882 87 7 115 This is a publication of STR Global Limited and is intended solely for use by subscribers. Reproduction or distribution of this report, in whole or part, without written permission of STR Global Limited is prohibited and subject to legal action. Site licenses are available. Ownership, distribution and use of the report and its contents are subject to the terms set forth in the contract you have entered into with STR Global Limited. Source 2011 STR Global Limited
Katerina Park and Moscow Hotel Market dynamics 2012 Main hotel results 2012 My Property: Katerina Park Hotel #171877 Comp Set: Hotel Cosmos #132543, Korston Hotel Moscow #132628, Holiday Inn Moscow Suschevsky #139624, Holiday Inn Moscow Sokolniki #140504, Excludes Subject Property Currency: RUB - Russian Rubles Occupancy ADR RevPAR Date This Year % Chg Index This Year % Chg Index This Year % Chg Index My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set Jan 2012 41 34 14 23 120 3244 3671 7 2 88 1336 1261 23 26 106 Feb 2012 56 59-14 8 95 4019 3876 21 10 104 2268 2303 4 18 99 Mar 2012 74 60-2 12 125 3429 3612 9 0 95 2545 2152 7 12 118 Apr 2012 76 70-3 16 108 3269 3579 9 7 91 2471 2499 6 24 99 May 2012 77 68-5 17 114 3113 3202 17 4 97 2402 2167 12 22 111 Jun 2012 85 70-5 -1 122 2979 3144 12 8 95 2540 2201 6 6 115 Jul 2012 73 61-12 9 120 2742 2693 16 2 102 2007 1638 2 11 123 Aug 2012 84 71-6 14 118 2692 2466 13-1 109 2250 1746 6 13 129 Sep 2012 90 72-2 -6 125 3101 3703-2 12 84 2797 2665-5 5 105 Oct 2012 82 68 1 1 122 3331 3924 11 11 85 2733 2649 12 12 103 Nov 2012 76 64 11 8 120 3245 3954 0 6 82 2468 2511 11 14 98 Dec 2012 57 54 6 6 107 3921 3539 13 1 111 2250 1892 20 7 119 TOTAL 2012 73 62-2 8 117 3214 3424 10 5 94 2338 2135 8 14 110 This is a publication of STR Global Limited and is intended solely for use by subscribers. Reproduction or distribution of this report, in whole or part, without written permission of STR Global Limited is prohibited and subject to legal action. Site licenses are available. Ownership, distribution and use of the report and its contents are subject to the terms set forth in the contract you have entered into with STR Global Limited. Source 2012 STR Global Limited
Katerina Park and Moscow Hotel Market dynamics 2013 Main hotel results 2013 My Property: Katerina Park Hotel #171877 Comp Set: Hotel Cosmos #132543, Korston Hotel Moscow #132628, Holiday Inn Moscow Suschevsky #139624, Holiday Inn Moscow Sokolniki #140504, Excludes Subject Property Currency: RUB - Russian Rubles Occupancy ADR RevPAR Date This Year % Chg Index This Year % Chg Index This Year % Chg Index My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set My Prop Comp Set Jan 2013 41 34 14 23 120 3244 3671 7 2 88 1336 1261 23 26 106 Feb 2013 56 59-14 8 95 4019 3876 21 10 104 2268 2303 4 18 99 TOTAL 2013 73 62-2 8 117 3214 3424 10 5 94 2338 2135 8 14 110 This is a publication of STR Global Limited and is intended solely for use by subscribers. Reproduction or distribution of this report, in whole or part, without written permission of STR Global Limited is prohibited and subject to legal action. Site licenses are available. Ownership, distribution and use of the report and its contents are subject to the terms set forth in the contract you have entered into with STR Global Limited. Source 2013 STR Global Limited
Katerina Park hotel rating on TripAdvisor.com Recommended by Travelers from over the world: Ranked # 4 of 231 hotels in Moscow
Katerina Park Hotel Rewards on TripAdvisor.com TOP 25 Hotels in Russia 12 Moscow hotels listed: #1 Swissotel Krasnye Holmy 5* #2 Lotte Hotel Moscow 5* #3 Mercure Arbat Moscow (Accor) 4* #5 Katerina Park 4* #9 Ritz Carlton 5* #10 Ararat Park Hyatt Moscow 5* #13 InterContinental Moscow Tverskaya 5* #15 Radisson Royal Moscow 5* #16 Katerina City 4* #17 Moscow Marriott Royal Aurora 5* #18 Hilton Moscow Leningradskaya 5* #19 Savoy Moscow 5*
Transaction schedule Transaction schedule Holding structure The Buyer is offered to acquire 100% SPV, which owns Katerina Park hotel. The deal benefits from a clean SPV with an efficient tax structure and high book value. Upon agreeing a Term Sheet the Seller expects due diligence process and transactions documents to be finalized within a 40 day period and closing to take no more than 10 days thereafter. Holding vehicle UPG 100% SPV Asking Price to be discussed Subject of Sale Cyprus SPV Efficient Tax Structure High Book Value Holding level Transaction level 100% LLC Katerina Park
Development team profile VENDOR UMACO Group Founded: 1997 Company profile: Development and management of real estate. Territorial presence: Russian Federation UMACO forms a group of companies, each specializing in a particular industry in real estate of commercial purpose. OPERATOR UMACO Management One of the established hotel operators in Russia Solid 12-yaers track-record of hotel management, innovative hotel concept creation, delivering exceptional results for the shareholders Properties under current management: - Katerina City (120 keys) - Katerina Park (239 keys) - Katerina Alpik (160 units) Previously managed properties: - Iris Congress Hotel, Moscow (195 keys + 44 units), 2001 2002 ARCHITECT SWECO AVISTA The leading European architectural and design company. Projects: - Annual creation more than 25 000 projects - Baltic Pearl complex (St. Petersburg) project creation - More than 375 hotels created during 100-years history GENERAL CONTRACTOR UMACO Development Leading Russian hotel development company, specializing in the creation and construction of hotels on local real estate market. 10 year experience developing hotels in Russia alongside leading international architectural and design companies. Creation of innovative hotel concepts with both optimized layout and guest comfort. Projects: - Hotel Katerina City Moscow (opened in 1998) - Hotel Katerina City Yelabuga (opened in 2008) - Hotel Katerina City Krasnodar (building stage) - Condo hotel Katerina Alpik Krasnaya Polyana (opened in 2007)
Contact UMACO Group Shluzovaya nab. 6, build. 1-2, 115 114, Moscow, Russia Tel / Fax: +7 (495) 933 04 86 E-mail: office@umaco.org Hotel Katerina City Moscow 6, Shluzovaya Naberezhnaya www.umaco.ru www.katerinahotels.com