BEGINNING OF WORK

We have finished the clearing of the site, erected perimeter fencing and the signage according to the law in Venezuela. The construction of the foundation will start at the end of this month. We will be using the socalled "tunnel construction system" which it 3 times quicker than normal construction.

To read complete report in PDF format please download it here:

http://www.sunnycomfort.com/info/CARACOLA-NEWSLETTER-January-2010.pdf

Investing in property through fractional purchase has become increasingly popular in recent years.

It was pioneered in USA, but has become more popular also for UK and European Investors.

The advantage is that it enables Investors to invest a much smaller amount in any one particular property, which in turn makes it easier for them to have a balanced portfolio of various types of investment.

In the present financial and economic climate, fractional ownership becomes especially attractive. People need to put their money somewhere; and every type of asset has risks that are difficult to assess. Even cash is risky, with highly volatile exchange rates and with continuing uncertainties surrounding banks and inflation.

Therefore, spreading money between different asset classes is a wise policy. Investing relatively small amounts in a variety of properties in different locations is an excellent way of enacting this policy.

Please see attached a Caracola Resort Fractional brochure:
http://www.sunnycomfort.com/info/Caracola-Fractional-Facts.pdf

Here is the latest Caracola Beach and Spa Resort Availability Listing and Price Summary for February 24, 2009:
http://www.sunnycomfort.com/info/CC-Price-List.xls

Current Availability listing highlights in yellow the properties that have been set aside for fractional purchasers, these are located on floors 6 and 7. 

Latest figures show over 3% increase in visitor arrivals to Nueva Esparta, Venezuela

The latest figures released by the state of Nueva Esparta in Venezuela show that Europeans, and especially the British, are increasingly falling in love with the best kept secret in South America. Located off the North East Caribbean coast of the country, it comprises three picturesque islands with a total population of less than half a million. Figures from the Nueva Esparta tourism corporation, Corpotur, show a 3.42% increase in visitor arrivals (2,045,143) to the state for the period Jan - September 2008.

'State of New Sparta' as it was named in 1864 measures 50 miles by 12 and its main land mass is Isla Margarita founded in 1525. The state’s name comes from the heroism shown by its people during the Venezuelan War of Independence, thought similar to that of the Spartan soldiers of Ancient Greece. Isla Margarita, known widely as the "Pearl of the Caribbean", benefits from being outside the hurricane belt with an average climate of 27 degrees Celsius. It boasts little rain, a variety of natural scenery from mountainous terrain to lush vegetation and over 200 miles of sandy beaches. The area around the main town, Porlamar, offers a large number of facilities and activities for visitors including an 18 hole golf course, shopping, windsurfing, scuba diving, snorkeling and hiking. For this reason it has been a popular vacation destination for around 30 years.

These once undiscovered islands and their rich history is something more and more people are travelling to experience. In 2007 2.5 million people visited Isla Margarita alone, over five times its population. However, this masks the full story. Nueva Esparta has remained largely hidden to those from outside the area as most visitors come from mainland Venezuela. 91% of visitors in 2008 thus far arrived from Venezuela, suggesting a still traditional destination unspoiled by western tourism. Nevertheless, word of mouth about the islands and their status as an undiscovered haven is increasingly reaching more and more potential visitors further afield.

Since 2001, the percentage of hotel rooms occupied by visitors to Nueva Esparta has more than tripled to 76%. Europeans are the most enamoured by the islands, making up the vast majority of international visitors. 60,000 Europeans make the journey compared to only 25,000 from the rest of the world. The tourism figures also revealed the love affair an increasing number of Britons are having with Nueva Esparta. Now the third major international tourist market, nearly 10,000 British tourists visited the islands during the last year. This represents a 38% increase on the previous 12 months when around 6,500 Britons visited.

In addition, other northern European countries have also discovered Nueva Esparta and Isla Margarita. The Dutch, Danish and French are nearly as eager as the British, with the keenest Europeans coming from Germany with around 15,000 visitors. Like their ancestors hundreds of years ago, Europeans are increasingly interested in Nueva Esparta. This is particularly the case with northern Europeans looking for an alternative sunny island retreat from the Mediterranean norm, with a Caribbean style twist as well.

Significantly, a further reason accounting for the increase in British and European visitors to the islands is their accessibility from major cities and airports. The third most popular of all charter flights to Nueva Esparta is the First Choice flight from either Gatwick or Manchester airport which in the first eight months of 2008 brought almost 9,000 people. With its activities, facilities, views and beaches it offers a competitive and distinctive alternative to the familiar European destination. Whether it is for holidaying, visiting or retiring it represents an interesting new location as well as an untapped buy to let opportunity.

Mark Andrew, Managing Director of Emerging Earth who is marketing the Caracola Beach & Spa Resort near Porlamar, said:

"Isla Margarita in Nueva Esparta has remained undiscovered for most tourists across the world but this will not be the case for long. Over the last five years Europeans have become increasingly attracted to this unspoiled part of the world, a part that reminds them of the best of sunny island living. Demand among Venezuelans for accommodation sees no sign of abating either and their continued fascination with the islands demonstrates the reason why more and more outsiders keep returning, particularly those from Europe. We expect demand for property and accommodation over the next few years will continue to grow, above all for apartment resort developments where facilities and close by tourist attractions are plentiful".

Caracola Beach & Spa Resort, Isla Margarita

The Caracola Beach & Spa Resort comprises of a variety of apartments and duplexes spread across 15 floors, most with stunning views of the beautiful Caribbean beach. The development boasts excellent facilities that include restaurants, bars, swimming pools, chill-out areas, spa, gymnasium, beauty salon, high end retail outlets and beautifully landscaped gardens. All apartments are 1 or 2 bedroom and have air conditioning, are spacious with large terraces, fully furnished and come with a guaranteed rental return of 7% pa net for 10 years. This investment purchase is SIPP qualifying and offers tax efficient freehold ownership. Prices start from 79,000 EUROS / £63,000 for a one-bedroom apartment.

As we are all facing more difficult times and many people have concerns over the security of their investments I have received some information from the developer of the Caracola project Mar-y-Casa that will give investors comfort of the security of their investments:
 

See below e-mail from the Developer.

We have been developing for more than 20 years now and the financial situation of the company is very solid.  We have also diversified a lot. The company has invested massively in the last year in other projects. For example in Solar Energy, which is booming now.  Our partners are financially key, and our revenue does not come only from construction but other sources too.  Developing in Margarita has other advantages. Banks can finance up to 100% of the construction cost. Bearing in mind that the land has been paid already, there is no distress.  The finance is secured at 100% for the whole development cost.

The key thing in the Caracola project is the common areas, which is what makes it a special development (and the location as well). Worst case (which would actually be the best for the investors) is that they would have the first block and all the common areas. The hotel operator is aware of this too and happy.  So worst case scenario, we would develop the first phase altogether with the whole common areas and leave the other blocks until the end.  We are starting the construction in November.

I understand that in the actual credit crunch, some investors might feel some stress, but there is no reason to be pessimistic about Caracola.

I have received some good news regarding the rental pool agreement on Caracola.

    
Please see below updated information regarding the terms of the rental pool, this is great news as it gives clients more flexibility in their agreement.

    
1) If owners do not enter in to the rental pool but wish to at a later stage they can do by giving 12 months notice to the management company.

    
2) If owners are in the rental pool and wish at a later stage to get out of it they can do so my giving 3 months notice to the management company.

What is a Self-invested Personal Pension (SiPP)?
A SIPP is about the most flexible form of pension plan available. It works in much the same way as a standard personal pension except that while an insurance company tends to arrange a personal pension, a SIPP requires a pensioneer trustee. The pensioner trustee's role is to report to HM Revenue and Customs Office, claim the necessary tax reliefs and ensure the scheme isn't breeching any Inland Revenue requirements. To set up a SIPP you'll need to open a central bank account in which the pension fund will be held and from there the funds will be invested according to your (the investor's) wishes.

What are the benefits?
SIPPs allow you to take advantage of tax relief when buying property, in the UK or abroad. For higher-rate taxpayers the tax relief will be as high as 40 per cent - eg, if  a higher-rate taxpayer makes a contribution of £60,000 into their SIPP they would have  a £100,000 fund to spend on property. Also, you can borrow against a SIPP property. Further to that, any income arising from the SIPP assets is free of tax (with the exception of dividends on equities) and any capital gains made on the assets is also tax-free. However, SIPP investors should check that they are not liable to tax abroad. SIPPS also offer flexibility and investment freedom. They are limited only by the broad legislation of HMRC. Investment options such as stocks and shares, commercial property, funds and assets, which are not available to a personal pension, are open to SIPP holders.

Is buying abroad possible with a SiPP?
Yes - but, as with UK property, it has to be classed as ‘commercial' property, which means you can't buy a residential villa or apartment for personal use through a SIPP. A SIPP is a trust arrangement and a number of countries - for example, France, Spain and Portugal - do not legally recognise pension trusts, a fact that can make the legalities of buying a SIPP property there rather complicated. Also noteworthy is that pensioneer trustee fees tend to be significantly higher - at around £5,000 per property transaction for overseas property. Another option is to invest in overseas property indirectly - that's to say, invest in an investment trust, unit trust or Open-Ended Investment Company (OEIC). That way, you benefit from more diversification and more liquidity and avoid charges usually associated with directly holding property.

Who is eligible for a SiPP?
Any individual is eligible for a SIPP. It does not matter if you are already a member of a company pension scheme, they are open to everyone. There are also no age restrictions - SIPPS are even available to children.

Do SiPPs suit certain budgets?
SIPPs are only really appropriate for larger funds as establishment fees and transaction costs are considerably higher than for a normal pension scheme. To set up a SIPP fund costs around £600 and then there are annual trustee fees of around £350-£500. You will also have to pay a transaction cost of £25-£35 every time something is changed in your SIPP portfolio. Then, of course, there are the dealing costs of buying and selling investments to consider.

Are there any cases when you'd advise against buying through a SiPP?
I'd certainly advise investors considering purchasing a property through a SIPP to proceed with caution as problems may arise if the individual requires and expects a tax-free lump sum when they retire. Return on an investment is subject to property market conditions, and judging whether these are at their most favourable can be even harder when dealing with an overseas property.

Is there anything buyers should be wary of when buying through a SiPP?
There are additional costs when buying and selling through a SIPP that investors should be aware of, including increased legal costs. The property will also have to be valued on a periodic basis by a trained valuer. It's advisable that an investor only uses the services of a solicitor who has the required experience of property purchase via a SIPP and, when buying abroad, has a foreign language.

Simon Pritchard Jones

ORLANDO, FL - Geneva Hospitality Group is going international by inking the deal on two new and prestigious resorts in Spain - The Palatinum Resort and Spa and in the Caribbean Sea, Caracola Beach and Spa Resort.

These new acquisitions come on the heels of Geneva Hospitality's successful, award-winning openings of two Mike Ditka Resorts in Central Florida - Mike Ditka Lighthouse Resort Key and Spa, winning the prestigious Expedia Insiders "Insiders' Select List" for 2008, and Mike Ditka Resort Runaway Beach Club, winning Orbitz's 2008 "Best In Stay Award for Family Hotels in Orlando," receiving a four-star rating.

Management by Geneva Hospitality Group ensures that top-quality services are applied to these new upscale developments building on a solid foundation of thirty-five years experience. While maintaining a small profile, Geneva Hospitality Group is considered one of the USA's premier Hotel/Condominium management companies. Their experienced, corporate management staff represents a multi-disciplined team of professionals highly skilled in operations, accounting, marketing, information technology and human resources. Geneva's success comes from having an owner's mentality coupled with an operator's experience, addressing that ownership and competent management go hand in hand.

In today's competitive marketplace, bigger is not always better. Geneva Hospitality Group is able to maintain traditional small company flexibility while at the same time facilitate the creation of crosscutting teams to support larger customer efforts to the benefit of owners, operators and investors alike.

Caracola Beach and Spa Resort is located on Margarita Island and is comprised of 15 floors of 1200 luxury condominiums and duplexes. Currently under construction, This "Pearl of the Caribbean" will be a playground for visitors and investors alike. There are four different floor plans to choose from varying in sizes up to 1,260 sq. ft. with nearly all offering views of the Caribbean Sea. Situated below the Hurricane Belt, Caracola Beach and Spa Resort will offer themed restaurants, a nightclub, mini market, duty-free shopping, beach activities, infinity pools and a World-Class Spa. These spectacular units will be the ultimate in comfort and luxury.

ETN Global Travel News, Oct 01, 2008

In the September issue of “A Place in the Sun” Magazine (on sale now), there is an article on page 32 “Guide to SIPPs and Overseas property”. 

The only Overseas Project mentioned is Caracola Beach and Spa Resort.

There are tens of thousands people out there with under-performing pensions who may consider transferring their pension into a SIPP and purchasing an overseas property.
 

See a copy of the article attached.

Please find attached a copy of the letter of intent regarding the mortgage from the developer together with a supporting statement below:

1. It is as critical for the developer as the clients that that a mortgage is in place when the properties are complete as his profit would reside in the back end payment. This is why we are extremely confident that a mortgage facility for clients on Caracola will be in place.

2. The developer is in an advanced position of negotiations with a number of first line banks with a view to providing a mortgage on Caracola. It is anticipated and expected that by the time the properties are complete that a mortgage for the 70% balance will be in place.

3. The developer is now very near to able to provide a mortgage which he could facilitate through his own borrowing and subsequent re-lending to clients via himself. This is just one option you may have to take advantage of.

4. Any mortgage will be based upon the company owning the property with the client owning 100% of the shareholding in the company therefore the clients own personal circumstances are effectively irrelevant. It will be your company that actually takes the mortgage.

5. Caracola presents great lending criteria for a bank as the prices are expected to rise dramatically as well as there being a rental guarantee for 10 years backed by a fidelity bond.

6. When you pay over your deposit it is held in Escrow and only passed over when the holding company are satisfied that the governing criteria of the various stages are met before passing funds across.

Attached is a copy of the report that AG2 Solicitors will be sending out to clients. Having carried out all of their due diligence AG2 provide a positive report confirming that all legal guarantees and protection are in place.