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WELCOME TO CITYSUITES PART II

MAXIMISING RETURNS IN RESIDENTIAL INVESTMENT Any investment opportunities or related investment services mentioned in this document are only intended for sophisticated, high net worth or professional clients.

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Any investment opportunities or related investment services mentioned in this document are only intended for sophisticated investors, high net worth or professional clients.

AN INVESTMENT SCHEME DESIGNED TO POOL RENTAL POTENTIAL AND MODULATE INVESTOR RISK. A COLLECTIVE INVESTMENT SCHEME OFFERING ASSURED RETURNS OF 7% FOR THREE YEARS

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MINIMUM 7% NET RETURNS

7% ASSURED FOR 3 YEARS

3 HOW THE COLLECTIVE INVESTMENT WORKS

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Buy the property

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Lease it back to CitySuites

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CitySuites manages and maintains the property, providing assured NET returns of 7% for the first three years

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Provided key objectives are met in the first five years, the collective investment scheme renews for a further five years

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Welcome to CitySuites

Purchasers can opt out of the collective investment scheme at any time*

*Subject to terms and conditions

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THE COLLECTIVE INVESTMENT SCHEME

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Economies of scale

CitySuites investors can participate in a collective investment scheme that pools rental income with other properties in the building, providing an assured minimum of 7% NET returns for the first three years.

This has the potential to alter the investor risk profile and change the return structure by:

As well as pooling rental, the collective nature of the scheme means that costs are also pooled. CitySuites can achieve economies of scale with various management elements such as cleaning, Sky TV, gas, electricity, water and property marketing that reduce costs in comparison to an individual property.

Strength in numbers Rather than compete with other properties within the same development for tenants, the pooled rental scheme creates a scenario in which any revenue generated by the building is beneficial to all investors.

THE POOLED RENTAL SCHEME CREATES A SCENARIO IN WHICH ANY REVENUE GENERATED BY THE PROPERTIES IN THE SCHEME IS BENEFICIAL TO ALL INVESTORS.

Accessing the full rental spectrum The key advantage of this model is that it gives investors access to the lucrative shortterm rental market that drives up the yield.

At the same time, owners also benefit from the added security of the longer term 12-month tenancy market.

Reducing the effect of voids Provided at least one property within the scheme is rented, investors will earn an income. This reduces investor exposure to the hit-or-miss nature of direct rentals.

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THE KEY ADVANTAGE OF THIS MODEL IS THAT IT GIVES INVESTORS ACCESS TO THE LUCRATIVE SHORT-TERM RENTAL MARKET THAT DRIVES UP THE YIELDS.

Welcome to CitySuites

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COLLECTIVE INVESTMENT SCHEME: KEY QUESTIONS

How long does the collective investment scheme last?

What happens after the threeyear rental assurance?

The property is sub-leased back to CitySuites Management for a period of five years.

During this time it is included within the collective investment scheme and both income and costs are pooled.

For the first three years, investors will receive assured returns of 7% NET per annum. Following that assured period, the collective investment scheme will continue to pool rental returns and offer yields on a representative basis, according to the terms of the sub-lease.

Can owners opt out of the collective investment scheme?

Can owners use the property for personal use?

Yes, owners can opt out of the collective investment scheme at any point. To opt out of the collective investment scheme they need to give appropriate notice. This period is either six months or the remaining time associated with the current tenancy of their property if this exceeds six months.

Owners of a CitySuites property within the collective investment scheme are offered the ability to rent a property within the scheme for one month a year at a rate discounted by 25%.

Owners also need to pay a fee that is equivalent to the annual management costs for the number of years remaining in the five-year sub-lease.

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CitySuites has targeted several cities around the world for future developments including Dubai, Hong Kong and New York which will allow owners in one development to access others utilising the same discounted rate.

Welcome to CitySuites

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HOW YOUR YIELD IS CALCULATED

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Example unit yield

CitySuites yields are calculated at the end of each quarterly period and paid to investors at the end of the following quarterly period.

Yields are calculated as follows:

The amount each owner receives is based on the value of their property in relation to the total value of the properties within the scheme.

The rental payments from each of the properties within the scheme are pooled and paid to investors net of all costs including service charges and management fees.

Annual yields of 7% NET are based on the following assumptions:

Based on CitySuites average studio price of:

£206,233 Total rental revenue:

£23,395 Management and service costs:

£745p/m

35% 35% of the pooled properties are let on one-month tenancies

35% 35% of the pooled properties are let on three-month tenancies

30% 30% of the pooled properties are let on 12-month tenancies

This fee includes: – Sky television

– Marketing of property

– Jacuzzi maintenance

– Weekly cleaning

– Management of your property

– Ground rent

– Weekly towels and bedding – 100 MB broadband – Phone line rental – Insurance

The above ratio has been calculated based on a Manchester city centre market. However, CitySuites will be actively targeting the one-month tenancy market in an attempt to maximise pooled income and increase rental yields beyond 7% NET.

Conversely, should the management team need to utilise more than 30% of the pooled properties for twelve-month lets, average yields could fall.

– Concierge service – Residence security – Pool maintenance – Gym maintenance

Total NET income:

Total NET Yield:

£14,455

7%

– Council tax – Gas – Electricity – Water

This sample is indicative of the figures expected on completion in 2016.

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Welcome to CitySuites

Welcome to CitySuites

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CitySuites | A New Concept In Residential Investment

Occupancy rates Occupancy across the pooled properties will vary. In general, occupancy rates will increase as the length of the tenancy rises, due to the likelihood of void periods decreasing.

Using STR Global Ltd’s 2013 Manchesteri short stay hotel occupancy rate of 77% as a base, targeted occupancy rates are:

85%

90%

95%

85% of one-month properties occupied

90% of three-month properties occupied

95% of the twelve-month properties occupied

With access to the full rental spectrum, CitySuites aims to achieve higher occupancy rates than other residential developments. Unlike developments limited to offering twelve-month lets, CitySuites has the capability to secure more shorter term one and three-month tenancies to minimise the chance of, and reduce the affect that void periods can have on overall occupancy rates.

7%

THE 7% RETURN IS ASSURED FOR THE FIRST THREE YEARS AND NET OF ALL COSTS INCLUDING SERVICE CHARGES AND MANAGEMENT COSTS.

All quotes and statistics used in this document are taken from third-party reports in the public domain and are listed below. Should further information be required please contact Select Property Group and we shall endeavour to provide you with the appropriate report

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http://cityco.com/media/uploads/2014/05/16/ Hotel_Occupancy_March_2014.pdf

Information in this document has been produced with great care and is believed to be accurate at the time of distribution. This is intended to be a summary of CitySuites products and services only and should be read in conjunction with other information we have made available for further consideration. Some details about specific CitySuites developments may be subject to change from time to time in accordance with final designs and approvals. We endeavour to ensure that any statistics, forecasts and market opinions are accurate and well researched however we do not warrant the accuracy of this information and should therefore not be assumed to be liable for any reliance you may make on it. Select Property is not qualified or authorised to give financial advice, investors are advised to seek independent investment advice as appropriate.

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Welcome to CitySuites

This document is issued in the United Kingdom by Select Money Limited (registered in England and Wales; number 5883721).

Welcome to CitySuites Select Money is the appointed representative of NCM Fund Services Limited (registered in Scotland, number SC166074), which is authorised and regulated by the Financial Conduct Authority with registered number 183732.