Dci Advisors Regulatory News (DCI)

3 Jan 2008 12:34

Dolphin Capital Investors Limited03 January 2008 3 January 2008 Dolphin Capital Investors Limited ("Dolphin" or the "Company") FIRST INVESTMENT OUTSIDE EASTERN MEDITERRANEAN AND VENUS ROCK ENHANCED DEVELOPMENT POTENTIAL Dolphin, currently the leading investor in the residential resort sector in theeastern Mediterranean and the largest real estate investment company listed onAIM, is pleased to announce today its first investment outside its coreinvestment region. This intention was confirmed to shareholders in the Company'sInterim Results statement on 18 September 2007 and follows the amendment in theCompany's investment policy during its fundraising in June 2007. In addition, Dolphin is pleased to report favourable changes to the currentzoning status of Venus Rock Golf Resort. Highlights of the Company's first investment outside its core investment region: • Dolphin is entering into a joint venture (the "Joint Venture") with Aman Resorts, for the acquisition and development of Playa Grande (the "Project "), an exclusive leisure-integrated residential resort on a 790-hectare site (the "Site") along one of the most spectacular beaches in the Dominican Republic. Aman Resorts, one of the Company's existing operating partners, is already successfully operating the Amanyara Resort in the nearby Turks & Caicos islands. • Playa Grande is to comprise a 40-room Aman hotel and 40 Aman villas, a 200-room five-star golf hotel most likely to be operated by GHM (Aman Resorts' affiliated brand) and approximately 350 cliff, golf and seafront residential units. Jean-Michel Gathy, world-renowned resort architect and Dolphin's project partner in Kilada Hills and Livka Bay, will be designing what is set to become the Dominican Republic's first Aman Resort. • Dolphin will participate with a stake of at least 70% in the Joint Venture, which has acquired 100% of Playa Grande Holdings ("PGH"), the entity owning the Site, for an enterprise value of up to $57 million (€38.8 million). The remaining shares in the Joint Venture will be owned by Aman Resorts (up to 25%) and private investors (up to 5%). • Based on this acquisition enterprise value, the Joint Venture is currently investing up to $23.5 million (€16 million) of equity capital to acquire the Project. The Joint Venture is also committing an additional $23 million (€15.7 million) to fund the design, permitting process and early stages of development and operation of the Project. • The Joint Venture will acquire approximately 715 hectares of the Site. The existing owners, some of the USA's most prominent individuals in the world of finance, media and the arts, will retain the remaining Site for their own use. Details of the Investment: Playa Grande, set to be developed into the Dominican Republic's first AmanResort, represents Dolphin's first investment outside its core investmentregion. In June 2007 the Company's investment policy was varied to give Dolphinan allocation equal to 5% of the Company's last reported NAV for investments innew geographies outside the eastern Mediterranean where the directors considerthat such investments would be complementary to the Company's investmentportfolio and/or offer attractive returns. The Playa Grande developmentrepresents the first use by the Company of these allocated funds and representsan opportunity for significant capital returns in the fast-growing second homemarket of the Dominican Republic. The Site, owned by the Dominican Republic's Central Bank until 2004 and longdestined to be one of the nation's premier tourist resorts, is a Site ofstriking natural beauty. The resort boasts one of the last golf coursesdesigned by Robert Trent Jones Sr. Free from the limitations normally imposed bydevelopers on golf designers, he created a stunning course with ten of its holesrunning alongside twenty-metre high cliffs bordering the Atlantic Ocean. The70-hectare course is known as the "Pebble Beach of the Caribbean" and is widelyperceived as one of the most magnificent golf courses in the western hemisphere.Further details and photographs of the Site can be found at www.playagrande.com. The Site comprises approximately 790 hectares and is located on and around thespectacular Playa Grande beach, on the northern coast of the Dominican Republic.The Site consists of approximately 9 km of seafront and is situated between thetwo small towns of Cabrera and Rio San Juan, each approximately 8 km away.Puerto Plata, the closest international airport, is just over an hour away bycar. The smaller airport of Nagua, which began receiving charter flights in2006, is also only a 50-minute drive by car from the Site. In July 2004, the Site was sold by the Central Bank to the existing owners whorepresent some of the USA's most prominent individuals in the world of finance,media and the arts. Their desire to work with Aman Resorts and alongside aleading investor in upscale residential resorts resulted in Dolphin beingbrought into the deal. The Joint Venture has now acquired PGH and approximately 715 hectares of theSite for an enterprise value of up to $57 million (€38.8 million) by undertakingto deliver to the existing owners the remaining Site for them to build high-endresidential units for their own use in accordance with construction guidelinesset out in the sale and purchase agreement. Dolphin is participating in theJoint Venture with a stake of at least 70% and the remaining shares will beowned by Aman Resorts (up to 25%), a strategic partner of Dolphin andparticipant in the Company's Amanmila and Seascape Hills resorts, and AxiaVentures, a consortium of private investors (which can acquire up to 5% of theJoint Venture). It should be noted that Antonios Achilleoudis, a director ofAxia Ventures, is also a member of the Board of Directors of Dolphin. The exactshareholdings will be determined by March 2008. As part of the transaction, the Joint Venture will be assuming two of PGH'sexisting obligations: a $26 million liability to the Central Bank of theDominican Republic and a $7.5 million loan with Banco Leon, a prominent localbank. Furthermore, the Joint Venture will undertake to cover the infrastructureand utility costs to enable the existing owners to build approximately 74 villason their portion of the Site. The Joint Venture and the existing owners share a unified vision in creating anexclusive, low density and environmentally sensitive resort development thatcomplements the striking natural beauty of Playa Grande. They have agreed tocooperate jointly regarding many aspects of the Site's development. A jointphilanthropic fund will also be established, aimed at supporting the localcommunity's environmental, cultural and educational needs, among others. Based on an acquisition enterprise value of up to $57 million (€38.8 million),the Joint Venture is currently investing up to $23.5 million (€16 million) ofequity capital to acquire the Project. The Joint Venture is also committing anadditional $23 million (€15.7 million), to fund the design, permitting processand early stages of development and operation of the Project. Playa Grande represents a unique opportunity for Dolphin to strengthen its tieswith Aman Resorts and, as previously stated to its shareholders, extend itsportfolio within the allocation limitations beyond its core investment region tothe Caribbean, Central and South American markets, which the Investment Managerbelieves exhibit similar investment opportunities to those in south-east Europe.The Dominican Republic, long known for its striking natural beauty and thewarmth of its people, is already a sought-after destination, attracting secondhome investors from Europe, North and South America. Playa Grande is uniquelypositioned to capitalize on the recent success of existing resorts such as Casade Campo, Punta Cana and Cap Cana which have witnessed record high sellingprices of $7,000-15,000 (€5,039-10,797) per buildable square metre and$750-1,500 (€540-1,080) per square metre of land. The Project, to be designed by world-renowned architect Jean-Michel Gathy ofDenniston International (www.denniston.com.my), will be developed as a luxuryseafront residential resort with a 40-room Aman hotel, 40 Aman villas(www.amanresorts.com), a 200-room five-star golf hotel most likely to beoperated by GHM (Aman Resort's affiliated brand, www.ghmhotels.com) andapproximately 350 mountain, golf and seafront residential units. In addition,the existing shareholders will build approximately 74 villas on their retainedland, which will be master-planned and developed as an integral part of thePlaya Grande resort. The Joint Venture will also be upgrading the existing golfcourse and will create supporting recreational, sports and retail facilities.The Project is at an advanced stage in terms of permits, having already receiveda final environment impact permit and has obtained a 10-year tax exemptionstatus. Progress at Venus Rock Golf Resort: Dolphin is also pleased to report today on favourable amendments to the currentzoning status of Venus Rock Golf Resort ("Venus Rock" or the "Resort"), inaccordance to a new zoning plan announced by the Government of Cyprus forcertain parts of the island. Amongst the various positive amendments for Venus Rock, the most important oneis that according to the new plan approximately 56 hectares of land have beenconverted from agricultural to residential for holiday-home use with a 25%building coefficient. These amendments result in increased developmentpotential, improved product-mix and accelerated time-frame of the permittingprocess for part of the Resort and are expected to have a significant positiveimpact on the value of Venus Rock, to be reflected in the Company's results forthe twelve months to 31 December 2007. Dolphin is managed by Dolphin Capital Partners ("DCP" or the "Investment Manager"). Miltos Kambourides, Managing Partner of DCP, commented: "We are delighted to be partnering again with Adrian Zecha, through his AmanResorts and GHM Hotels companies, to create what is expected to be one of theCaribbean's premier resorts, leveraging also on the experience gained from thesuccess of Amanyara, located in the nearby Turks & Caicos islands and alsodesigned by Jean-Michel Gathy. "We believe that this project will benefit from the supply-demand imbalance forpremium branded residential resorts in the region and should create substantialvalue for our shareholders." He added: "The zoning changes announced by the Government of Cyprus have come at a veryopportune time and will undoubtedly allow for more flexibility in themaster-planning and overall design of Venus Rock. Its additional developmentpotential is expected to generate considerable incremental value as Venus Rock,one of the largest seafront residential resort development sites in Europe,establishes itself as the first major Dolphin golf-integrated resort to come tomarket." For further information, please contact: Dolphin Capital PartnersMiltos Kambourides / Pierre Charalambidesmiltos@dolphincp.com / pierre@dolphincp.com Grant Thornton Corporate Finance Tel: +44 (0) 20 7383 5100(Nominated Adviser)Philip Secrett/ Fiona Kindness Panmure Gordon Tel: +44 (0) 20 7459 3600(Broker)Richard Gray / Dominic Morley / Andrew Potts Financial Dynamics Tel: +44 (0) 20 7831 3113(Public Relations)Stephanie Highett / Nicole Marino / Dido Laurimore Notes to Editors Dolphin Capital Investors Dolphin, currently the largest real estate investment company listed on AIM,seeks to provide shareholders with strong capital growth combined with a lowrisk profile through investing in early-stage, large-scale, leisure-integratedresidential resorts mainly in south-east Europe in partnership with worldleading designers and operators. Dolphin's shares commenced trading on AIM inDecember 2005 raising £70.7 million (€104 million) at an issue price of 68p,followed by a £202.7 million (€300 million) secondary offering at a price of 93pper share in October 2006. In June 2007, Dolphin raised an additional £303million (€450 million) in a follow-on issuance priced at 170p per common share. With this investment in the Dominican Republic, Dolphin has in total investedapproximately €443 million and committed approximately €670 million to variousprojects in Greece, Cyprus, Croatia, Turkey and the Dominican Republic. Dolphinis also the 85% owner of Aristo Developers Plc, one of the region's largest andmost experienced holiday home developers. Dolphin Capital Partners DCP is an independent investment management business founded in 2004 by MiltosKambourides and Pierre Charalambides after leaving Soros Real Estate Partners. The DCP professionals combine extensive local knowledge and contacts withexpertise gained at some of the world's leading financial institutions. Theyspecialise in providing capital to rigorously selected real estate developmentsmainly in the eastern Mediterranean, typically through joint ventures with localdevelopers. DCP cooperates with an international and sophisticated network ofoperators, designers, master-planners and marketing agents for each of itsdevelopments. This information is provided by RNS The company news service from the London Stock Exchange