27th Apr 2006 07:00
Ottoman Fund Limited (The)27 April 2006 For Immediate Release 27 April 2006 The Ottoman Fund Limited Significant land purchase in Bodrum The Ottoman Fund, which invests in the development of local housing and holidayhomes in the major cities and coastal resorts of Turkey, is pleased to announcethe acquisition of development land in the Bodrum peninsula on the Aegean coastof Turkey. The Fund, which is quoted on AIM, is managed by Development Capital Management(Jersey) Limited. Highlights • Agreement has been reached to purchase 166,825 square metres of sea-front development land on the Bodrum peninsula, one of Turkey's most popular coastal destinations. Villas in Bodrum, and particularly in this area of the northern part of the peninsular, are particularly sought after by local wealthy buyers. The site is located approximately 50 kms from Bodrum international airport. • The total purchase price is approximately US$33.4 million, equivalent to US$200 per square metre of land and approximately US$650 per square metre of buildable space. This is in line with current market prices as verified by an independent valuation. • On completion of the purchase the Fund intends to develop the land, in joint venture with a local developer, into a villa complex of around 250 units. Development costs are expected to be in the region of US$650 - US$750 per square metre of built-up area. • Construction expected to commence towards the end of 2006, with completion anticipated by the 2008 summer season. Sales are expected to commence in Autumn 2006. • Current "as-built" sale prices, based on comparable properties selling in the region, are estimated by the Manager at US$2,000-US$2,500 per square metre. If all of the units are sold at these prices over the next two years, the gross internal rate of return on the Fund's investment would be in the range of 45% to 70%.* • Images of the site may be viewed at www.ottomanfund.co.uk/kucukbuk. The Chairman of the Fund, Sir Timothy Daunt said: "The purchase of land in Bodrum together with the Fund's development plans represents an important step in theearly life of the Fund. The Bodrum area is popular with both local and tourist buyers and therefore we would expect the development to sell well." Further Details The Ottoman Fund Limited (the "Fund") has (through a local subsidiary) signed an agreement to acquire 166,825 square metres of sea-front development land on theBodrum peninsula, one of the most popular coastal destinations in Turkey. The site is only 50 kms from Bodrum's international airport and just 20 kms off the main Milas-Bodrum highway. Tourism infrastructure and transportationaround the area is well developed. The region benefits from a Mediterranean climate with the summer season lasting 8 months. Local and foreign tourists to the area numbered 2.5 million in 2005. Villas in this area of the northern part of the peninsular are particularly sought after by local wealthy buyers looking for a holidayhome. The Fund will pay a price of approximately US$33.4 million equivalent to US$200 per square metre of land and approximately US$650 per square metre of buildablespace. This is in line with current market prices as verified by an independent valuation. Local taxes, commissions and agent fees total an additional US$1.7million. The Fund will work in joint venture with a local developer (to be selected) to produce a development plan for the site and to select and appoint architects, aconstruction company and other professionals for the project. The Fund intends to develop the land into a villa complex of around 250 units. Work is expected tocommence towards the end of 2006, with completion anticipated by the 2008 summer season. Development costs are expected to be in the region of US$650 - US$750 persquare metre of built up area. Sales are expected to commence in Autumn 2006. Current "as-built" sale prices, based on comparable properties selling in the region, are estimated by the Manager atUS$2,000-US$2,500 per square metre. If all of the units are sold at these prices over the next two years, the gross internal rate of return on the Fund's investmentwould be in the range of 45% to 70%.* List of contacts Development Capital Management 020 7399 4270Roger HornettTom Pridmore Buchanan Communications 020 7466 5000Charles RylandIsabel Podda Numis Securities Ltd 020 7776 1500Andrew DawberIain McDonald * This internal rate of return (IRR) calculation is based on the assumption thatthe units are sold over a period of 2 years at the estimated open market valueand on the assumed build costs provided by the Manager. The calculation isbefore tax but net of sales commission and other marketing costs. The Directorsof the Fund consider the IRR to be calculated after due and careful inquiry.This statement should not be taken as an assurance that the apartments will infact be sold for the estimated valuation within 2 years. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Ottoman Fund