Equity Growth
As a purchaser, you will combine the benefits of a consistent rental income, fixed for the first 3 years of operation as well as an increase in property value.
The capital growth potential in Cape Verde is underpinned by various key factors.
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Cape Verde has demonstrated a consistent growth in touristic demand for the last 20 years
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Tourism growth is directly correlated to the capital growth of property in Cape Verde
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This means tourism is driving the economy and this directly impacts the value of your property
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There was a 13.6% increase in tourist arrivals in 2016
- Tourist arrivals are forecast to increase by a minimum of 5.8% p.a. to 57.3% of GDP by 2027
- Scarcity of available beach-front land at the right price in a developable area underpins capital growth
- The market is unlikely to become saturated due to supply of quality bed nights versus demand
Cape Verde: Visitor exports and international tourist arrivals
The Resort Group PLC conduct regular valuations by a globally recognised and accredited valuation company. These are done in accordance with RICS Valuation Standards.
Previous projects by The Resort Group PLC demonstrate growth in value between off-plan purchase and Resort opening.
Capital Growth Example: MELIÃ Dunas Beach Resort & Spa
|
Property Type |
Average Off-Plan Price (5 Year sales period) |
Valuation on Completion* (2015) |
Average Capital Growth p.a. |
|
1 Bed |
€115,940 | €164,093 | 8.3% |
|
2 Bed |
€166,250 | €214,406 | 5.8% |
| Villa | €367,320 | €472,483 | 5.7% |
*Based on Savills valuation 6.2% p.a.
• Capital growth of 6.2% p.a. across the Resort
• 1 bed properties 8.3%. TRG current Resorts have high proportion of 1 beds
• Tourism has continued to grow since 2015
• TRG now has guaranteed occupancy agreement with the world’s largest tour operator • Current capital growth projections are 5-8% p.a.
5 Year Example Return: Off Plan Property Purchase
|
Phase |
Capital Growth |
Property Value |
Rental Yield |
Rental Income |
|
Construction |
Year 1 5% | €157,500 | ||
| Year 2 5% |
€165,375 |
|||
| Operational | Year 1 5% | €173,644 | 5% | €7,500 |
| Year 2 5% | €182,326 |
6% |
€9,000 | |
| Year 3 5% | €191,442 | 7% | €10,500 | |
| €41,442 | €27,000 | |||
| Total | €68,442 |
• Average 9.13% p.a. over initial 5 year period
• Assumes capital growth levels below previous Resort performance • Includes fixed rate of return during first 3 years of operation
