The SDR Difference

Kiener Hills: A Booming Cebu Real Estate

The property “Kiener Hills Condominiums” in Mactan Island, Cebu, was originally completed in 2002. Of the 548 total units in the project, 30% have been internally furnished so far. The majority of these fully-furnished units are being managed by SDR Serviced Apartments as serviced apartments.

The project, over the past 12 months, has been completely redeveloped and upgraded. Kiener Hills is now a flourishing Cebu property in a great location that offers an excellent opportunity for both investors and end-users. Apartments in the project have appreciated 70% over the past 5 years. And despite the current economic gloom, investors are receiving a guaranteed return of 6% per annum or 60% of the net room income. Either way, you are on solid ground with a secure cash-earning investment.

Good Prospects for Cebu Real Estate

Savvy international investors and industry experts suggest that the main appreciation of Cebu properties will occur over the next 5 years and will not plateau for many years thereafter.

The Philippine Department of Tourism (DOT) is on record highlighting the gross shortage of Cebu accommodation. Even with the current construction boom in Cebu, there will not be sufficient rooms for the Department of Tourism’s projected needs for this market.

In terms of valuation, Cebu is way behind its fellow Asian resort destination neighbors Phuket and Bali. Similar to Bali, and despite adverse market conditions in the world, Cebu property prices and, more importantly, rental returns continue to surge. In terms of average price per square foot, similar condominium projects in Phuket sell for approximately US$375 per square foot (unfurnished), whereas the Kiener Hills property in Cebu sells at a minimum of US$99 per square foot (unfurnished).

Cebu’s Flourishing Tourism

Even in these tough times, Cebu has a lot to offer to a diligent investor. Growth in the Cebu tourism market is up 25% year-on-year in terms of people entering the province. More than 40% of all tourists coming to the Philippines stop or fly directly into Cebu. These figures compare favorably with those of Phuket. A direct result of Cebu’s growth has resulted in major improvements (underway) at the Mactan-Cebu International Airport, located a few minutes away from Kiener Hills.

Cebu has direct flights from the following countries:

China (Guangzhou and Shanghai)
Hong Kong
Indonesia (Jakarta)
Japan (Tokyo, Nagoya, and Kansai)
Malaysia (Kuala Lumpur and Kota Kinabalu)
Qatar
Singapore
South Korea (Seoul and Pusan)
Taiwan (Taipei)
Thailand (Bangkok)

Due to the growth in Cebu as a destination, more flights are being added regularly.

Kiener Hills’ Great Location

Kiener Hills is superbly located just 3 minutes away from Mactan-Cebu International Airport and a five-minute stroll to a supermarket, banks, restaurants, the Cebu Yacht Club, and the best resorts in Cebu. A golf course is within 5 minutes, and the beaches and world-class diving resorts are just 10 minutes by car.

Schools are a few minutes walk, whilst good hospitals are less than 10 minutes by car. The property is second only in number of apartments to the Shangri-La’s Mactan Island Cebu property, which is only 10 minutes away by car. Kiener Hills is within five-minute walk to the ocean and within 15 minutes of all the beach resorts in Mactan Island.

Kiener Hills, A Great Opportunity

The opportunity to purchase serviced apartments, which will be professionally managed by SDR, is hard to come by. Achieving either a guaranteed 5-year 6% per annum gross return or 60% of the net monthly room revenue is another good opportunity.

A studio purchase (on the guaranteed return program) will mean a gross amount of US$3,773 per year in guaranteed rental income program. At the same time, you’re riding the burgeoning Cebu property market for capital appreciation. Now that’s an investment that provides peace of mind in trying times.

Own a high-quality Cebu condo in two premier building’s B and E at these rates (less 10% for cash payments):

Studios Apartments: US$62,895
Loft Apartments: US$125,895
Loft Suite Apartments: US$155,195 (sold-out)
Deluxe Penthouse Apartments: US$245,695

We also have a limited number of economical Studio Apartments at **US$40,500 and **US$80,500 for two-bedroom lofts (with the same SDR standards) in buildings C & D in the project. **Plus furniture and appliance package if required.

As an investor, you will receive titles in your own name for each apartment purchased, and if you purchase in either of the two premier buildings in the project (Bldgs. B or E) you have a choice of two management contracts with SDR so that the returns start flowing:

(1) 6% PA guaranteed rental return for 5 years (for cash purchases), or
(2) 60% of the net monthly room revenue for 5 years

For those purchasing in Buildings A, C or D we offer option (2).

NOTE: Under Philippine law, it is legal for foreign individuals or corporations to own Condominiums.

Cash Terms: Each purchase will require a standard 10% deposit upon signing the reservation agreement. Upon signing the Sale and Purchase Agreement, 90% final balance will be required to be placed in our Attorney’s escrow account and released upon the execution of the Deed of Absolute Sale (DOAS).

SDR’s Existing Management Operation

SDR Serviced Apartments commenced operations in November 2003. Since inception, SDR has maintained average room occupancy of 80%, which is amongst the highest in Cebu. SDR’s proven business model is based on long-term foreign guests wishing to stay in 4-star accommodation in a great location but without the expensive price tag.

SDR apartments range from 395-1,415 square feet, and monthly minimum rent is US$999 for the studio apartments (including utilities). The end-user has a luxuriously furnished apartment with an efficient kitchen, microwave oven, dual-burner gas stove, cooking and eating facilities, a large bathroom, cable TV, digital telephone, complimentary high-speed Internet, and a balcony. The apartments also have two swimming pools and a recently completed bar and restaurant.

Benefits of SDR’s Fully Managed Rental Program

* In addition to the instant and ongoing rental returns and seeing significant appreciation of the value of your asset over time, you (as apartment owners) are able to finance your investment with real rental returns;

* Rental management by SDR Serviced Apartments ensures your apartment will be maintained in optimal condition at all times so no need to worry about bills or maintenance fees;

* Your Cebu apartment will be furnished according to the highest four-star standards;

* Each apartment becomes part of the SDR Serviced Apartment inventory and you sit back and enjoy the returns;

* SDR’s proven sales, marketing, public relations, and distributional network will rent your apartment to savvy tourists at attractive rates;

* Apartment owners will have two attractive rental return options to choose from:

1. Guaranteed rental return of 6% per annum for 5 years*

For example, if you purchase a studio apartment for US$62,895, you will receive a gross return of 6% (or US$3,773 per year) for each year of SDR’s five-year management contract.

* Average return per apartment is before applicable taxes and borrowing cost.
* Yield % (i.e. average return per Apartment/Investment) is based upon investment price.
* Cost of condo corp. fees, a/c maintenance, Internet, cable TV, and telephone basic charge (total less than Php 2,990 per month as of June 2010) payable by owner.
* 6% guarantee is available only to units sold by SDR and finished to SDR standard furniture package and located in buildings E and B.
* Rental terms are subject to standard SDR Terms and Conditions.

OR

2. Actual rental return based on 60% of net room revenue**

The rental contract is renewed every 5 years:

** Net room revenue is after G.S.T., travel agent, and credit card commissions.
** 60% return is determined by reference to net room revenue only.
** Average return per apartment is before applicable taxes and borrowing cost.
** Yield % (i.e. average return per Apartment/Investment) is based upon investment price of US$62,895.
** Cost of condo corp. fees, a/c maintenance, Internet, cable TV, and telephone basic charge (total less than Php 2,990 per month as of June 2010) payable by owner.
** Rental terms are subject to standard SDR Terms and Conditions.

The above figures are for illustration purposes only. Contact us for specifics.

SDR’s In-House Finance Options

SDR offers innovative and flexible payment plans of up to 10 years for Kiener Hills Condominiums. This in-house financing has made it a simple process for both locals and foreigners to join this exciting Cebu real estate project. The fixed financing rates are also very competitive relative to bank lending rates, and buyers can finance up to 85% of the purchase price via SDR’s in-house facility.

Kiener Hills in a Nutshell

* A unique opportunity to consistently earn strong annual rental returns in a time when the world’s economies are struggling.

* Enjoy the significant capital appreciation on the asset in Cebu’s flourishing tourism market, which is currently heavily undervalued compared to similar resort locations.

* Ride on the experienced and proven SDR management team, who continue to achieve some of the highest occupancy rates in Cebu, and enjoy flexible payment options.

* Low risk and quick completion (all 5 buildings are structurally complete); SDR only need to do the internal improvement and furnishing of the units.

* Ride out the turbulent times with a solid 6% guaranteed return per annum on your investment at a time where depositing your money in a bank provides low interest rates and limited security over your money!

* Foreign ownership is 100% legal

* Philippines economy is booming with 2010 on target for 6% + growth.