reserve collection v3

The Reserve Collection

The Reserve Collection Partners

Olympus Resorts, Chicago/Vancouver, Focused on developing vineyard resort private residence clubs: • Financing• Site Selection• Negotiation

Bellstar Hotels & Resorts, Calgary/Vancouver, Leading resort developer & operator in Western Canada:• Development• Project Management • Design• Procurement

DCP International, Chicago/Dallas/Park City/Vancouver/Florence, World’s largest private residence club sales & marketing organization:• Advertising & Marketing• Sales• Private Residence Club (PRC) Exchange• Reservation & Processing System 2

The Reserve CollectionIntroduction to The Reserve Collection

Vineyard property ‐ most desired location mentioned by members of leading private destination clubs (Membership Surveys Q‐2, 2008)

Napa Valley is visited by as many as five million people each year (three million stay overnight), making it the second most popular tourist destination in California, second only to Disney Land (Source – Cushman & Wakefield)

Napa Travelers – 50% of visitors reported incomes in excess of $100,000 & spent an average of $233/person/day

Success of comparable vineyard resorts: Spirit Ridge Vineyard Resorts & Spa (Bellstar), Okanagan Valley, B.C.; Calistoga Ranch (Auberge Du Soleil), Napa Valley, CA; Inn at Carneros (Plump Jack Group), Napa Valley, CA

• Vineyard/Winery Property Owners: Many vineyard property owners are asset‐rich & cash‐poor

• “Second” home buyers: Have limited options to participate in the winery experience. Potential vineyard second/vacation home owners face a number of issues: high real estate prices, limited time to use/seasonal use, maintenance

• Olympus Resorts in conjunction with its partners created a solution – PRC’s: Enables land owners to turn an illiquid asset into cash without giving up control of their vineyard/winery

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EXECUTIVE SUMMARY


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Executive Summary

MISSION STATEMENT:Deliver exceptional vacation experiences to our owner/members & their guests by

providing access to the world’s premier vineyard locations & liquidity to vineyard/winery property owners


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EXECUTION:1. Build Luxurious Homes on and/or around vineyards and wineries2. Sell fractions of the home to wine connoisseurs – (PRC model)3. Share profits with vineyard/winery owner

BON ALLERExecutive Summary

PRC Benefits to Stakeholders: Vineyard/Winery Property Owner:• PRC’s provide liquidity/cash to property owners –

participate in PRC’s development & sales profits• Property owners maintain control of vineyard property

& wine operations• Significant cross‐marketing opportunities between the

winery & PRC members – “Vintner’s Club”• Strengthen brand/wine sales• PRC drives business in off‐peak seasons

PRC Members:• Lower cost of entry – opportunity to own real

estate/experience a vineyard/winery without the management hassles at a fraction of the cost of buying a vineyard second home

• Real estate professionally managed• Participation in a “Vintner’s” club/exchange – access to

other premier vineyard properties


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Executive Summary

PRC Benefits to Stakeholders: Bellstar/Olympus Resorts/DCP:• Established beneficial partnerships & strategic alliances• Excellent purchasing & project management• Industry leaders in marketing & media relations• Utilize “wine” purchasers lists from respective

vineyards/wineries to target oenophiles interested in purchasing real estate

• Cross marketing of similarly managed resorts• Consistency in systems, training & controls• Improved bottom line margin, profitability & return on

equity• Expand Vintner’s Exchange: Temecula, Santa Barbara,

Napa/Sonoma, Oregon, Washington, Australia, New Zealand, Argentina, Provence, Tuscany, South Africa, & Spain


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Executive Summary

PRC Execution/Implementation:Vineyard/Winery Property Owner:• Contributes a residence site located in a vineyard or

winery • Provide list of “wine” purchasers & other contacts• Assist in marketing presentations, tastings, & tours• Commit to a fully integrated ownership & vacation

experience for the PRC member (“Vintner’s” club benefits, participate in the growing, picking, & winemaking process, private label product, private tasting dinners, etc.)

Bellstar/Olympus Resorts/DCP:• Develops luxury residence on vineyard or winery site• Fund, market, develop & manage a fractionalized single

residence PRC• The residence would be complementary to the winery

architecturally & in quality in finish & fitting – review the plan’s/spec’s with the landowner


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Executive Summary

Initial targeted wine region: Okanagan Valley, BC


Osoyoos

• Nk’Mip Cellars• La Stella Winery

Similkameen

3. K Mountain Vineyards4. Herder Winery & Vineyards5. Crowsnest Vineyards

Black Sage Bench/Golden Mile

6. Burrowing Owl Estate winery7. Desert Hills Estate Winery8. Black Hills Estate Winery9. Golden Miles Cellars10. Antelope Ridge11. Inniskillin Okanagan Vineyards12. Hester Creek Estate Winery13. Gehringer Brothers Estate Winery14. Tinhorn Creek Vineyards15. Church & State16. Le Vieux Pin17. Quinta Ferreira Estate Winery

Okanagan Falls

18. See Ya Later Ranch19. Wild Goose20. Noble Ridge

North Oliver

21. Dunham & Froese Estate Winery22. Jackson‐Triggs Okanagan Estate

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Private Residence Club


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Private Residence Clubs (PRC’s)

History of the PRC:• PRC – concept was born at prestigious Deer Valley Resort in Park City, Utah in 1991 (DCP)• In the late 1980’s, Deer Valley vacation homes ranged in price from $500,000 ‐ $6,000,000, but owners would

only occupy these residences four to six weeks a year. In addition, the more expensive the home, the less likely that it would be made available as a rental property.

• DCP believed the time had come for a new, upscale, shared ownership concept

Typical PRC Features: • Sold in 1/8 units (1/4 – 1/10 range) – 4‐6 weeks of occupancy• 1.6x – 2.0x price premium over whole ownership• Equity ownership second home purchase• Exchange rights – to other properties in DCP/Bellstar portfolios• Membership fee ($200,000 ‐ $1,000,000) & annual HOA fees ($5,000 ‐ $15,000)


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Private Residence Clubs (PRC’s) – Who buys Residence Clubs? Why?

People who:• Frequent a particular resort/destination• Can afford a vacation home in that location• Want luxury, service, & amenities • Don’t want the responsibilities of absentee ownership• Can’t rationalize the cost of whole ownership• Don’t want to be anchored to one destination


Why:• luxury/location• vacation frequency• club staff• personalized service• deeded real estate• exchange

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Vintner’s Club & Exchange


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Vintner’s Club

Vintner’s Club – Exclusive to owners of The Reserve Collection:• Viticulture activities (demonstrating planting, pruning, harvesting, etc.)• Participation in the wine making & brand building process• Instruction on wine‐related food & wine pairing & culinary arts (popular in Napa) • “VIP Wine Makers Tasting Experience” tasting events for members only – sample reserve vintages• Private dinner with vineyard owners & wine master• Harvest Celebration – the opportunity to “volunteer” at the vineyard/winery during the harvest & crush• Invitation to a private annual gala wine release• A barrel of wine (25 cases) from one of the Vintner exchange wineries for the first five years of membership• Private label wine• “First Crush Club” to purchase up to two additional cases at regular prices before the wine is released each year to

the public


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Exchange

• Argentina • Australia• California: Mendocino, Napa Valley, Paso

Robles, Sonoma, Santa Barbara – Clara ‐Cruz, Temecula

• Gulf Islands, B.C. Canada• New Zealand

Vintner’s Exchange – members will have the ability to use/exchange their time at anyReserve Collection residence. Future locations may include:


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• Oregon • Provence• South Africa• Spain• Tuscany• Washington

Strategic Partners


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BON ALLERStrategic Partners

Bellstar Hotels & Resorts

401, 8989 Macleod Trail SCalgary Alberta, T2H 0M2

Leading resort developer & operator in Western Canada• April 2008: 9 resorts & 409 resort units (63% increase over 2007)

• September 2011 – 18 resorts & 1,500 units projected (committed & in development)

• Manage resorts, hotels & residences clubs

• Develop & manage condo/strata resorts

• Rental & property management

• Pre‐opening & marketing services

• Manage whole & fractional real estate marketing

• Owner accounting & reporting


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DCP International

2121 Waukegan Road, Suite 100Bannockburn, IL 60015

World’s largest private residence club sales & marketing/management organization

• 30 private residence clubs in the U.S. & Europe

• Over 7,000 members

• DCP residence clubs have generated more than $700 million in sales to date ($115 million in 2006)

• Capabilities:

• Product Design

• Legal Documentation Oversight

• Marketing & Sales

• Financial Planning

• Elite AllianceTM – international exchange


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Olympus Resorts

333 W. Wacker, Suite 1720Chicago, IL 60606

First in the fractional real estate market to exploit niche markets outside of beach or ski resorts:

• Raised over $700 million in real estate projects• Deployment experience worldwide

• North America• Napa Valley, CA (vineyard/winery)• Okanagan, BC (vineyard/winery)

• Europe• Provence, France (vineyard/winery)• Tuscany, Italy (vineyard/winery)• Birr, Ireland (equestrian estate)


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Fractionals – Market Research


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Fractionals – Market Research

Ernst & Young US 2008 Lodging Report – “Top 10 Thoughts:• Fractional residences have garnered less interest from speculators and, as a result, are weathering a declining

real estate market better than condominium‐hotels. Developers indicate that fractionals are generating price premiums of 100% to 200% per square foot over full‐ownership products, although with higher marketing costs & longer absorption periods.

• The credibility of a well‐known professional operator & sales team in addition to the flexibility of an exchange program, allows owners to trade time in any destination where the operator has a property & makes these programs more appealing than those offered by independent projects

• Fractionals generally fare better when developed alongside established hotels, as the hotels may encourage potential buyers, as well as critical mass for the development & associated guest services

• While the various second‐home hybrids are expected to be tested by a softening U.S. housing market in 2008, the underlying fundamentals of the baby boomer generation – their upcoming wealth transfer & time to enjoy it will lead to continued growth in the second‐home sector


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Fractionals ‐Market Research

The Shared Ownership/Use Resort Real Estate Industry in North America 2008 – Ragatz Conference – March 18‐20th, San Francisco

Top 5 Findings (2007): • 300 total developments, 153 in active sales plus 22 destination clubs• $2.3 billion of total sales volume• Increase of 8.3% from 2006• Growth primarily at equity residence club level, but mostly due to more projects• Remaining market depth: Estimated that 50,000 households have purchased shared ownership. This

represents about 1.5% of all households in the U.S. with incomes over $200,000.


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PriceWaterhouse Study Finds Growing Awareness of Luxury Fractional Ownership, December 7, 2006– “Affluent households (41%) have heard of fractional, & one‐sixth of affluent households indicate they may consider purchasing a fractional ownership resort within the next five years”

New York Times, April 13th, 2007 – “Fractional real estate or shared ownership, is growing rapidly, increasing to $1.65 billion in sales last year for the United States, Canada, & the Caribbean, up more than 30% from 2005”

Fractionals: Market Research The Reserve Collection

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Branding

Branding

• re∙serve1. To keep back, as for future use or for a special

purpose2. To set or cause to be set apart for a particular

person or use3. To keep or secure for oneself; retain

• col∙lec∙tion 1. That which is collected; as: A gathering or

assemblage of objects or persons2. A group of objects or works to be seen,

studied, or kept together3. Manège. An act of bringing or coming into a

collected attitude4. Several things grouped together or considered

as a whole


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The Reserve Collection evokes images of...Reserve wine – wine that is higher quality than usual, or a wine that has been aged before being sold, or both

Fine property ‐ the best locations, the finest vineyards, Canada’s premiere wine region

…brought together to create an exceptional collection of Private Residence Clubs


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reserve collection v3

Documents

reserve collection

develop

worldslargestprivateresidenceclubsales

leadingresortdeveloper

prcs

napavalley

temecula