Tunisia Brochure Unbranded Low Res

Investment Guide Modern... Mysterious... Exotic...

Tunisia The new Dubai of the Mediterranean

Contents Facts at a glance........................3 Getting There............................4 The essence of Tunisia...............5 Tunisian Cuisine.........................6

Northern Tunisia.......................7 Hammamet...............................8 Sousse.......................................9 Port El Kantaoui.......................10 Tunisia’s Economy...................11 Why Invest in Tunisia...............12 The Rental Market...................15 Rental Expectations.................16 Return on Investment.............17 The Dunes Golf & Spa.............18 5-star Resort

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GEOGRAPHY

Facts at a glance

 Tunisia is the northernmost country in Africa lying just 50 miles southwest of Sicily.  It measures 465 miles from north to south and only 93 miles from west to east making it comparable to the size of England.  The northern and eastern coastlines are bordered by the Mediterranean, while most of the southern half of the country is within the Sahara Desert.

Tunisia CLIMATE  Summers are hot and dry. In July and August daytime temperatures on the east coast average 30° C with 12 hours of sunshine. In the desert it can reach 45 ° C.  In the far north, winters are mild but quite wet, with occasional snow.  Daytime temperatures average 20° C all year long, however in the desert they rapidly fall at night to freezing.

PEOPLE  Tunisia has a population of around 10 million with more than half the population under the age of 18.  The Berbers are generally considered to be the original Tunisians.  Arabic is the official language whilst French is considered to be the language of business. English and German are spoken mainly on the coast and in the tourist areas.

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Getting There

BY AIR Tunisia has long been established as a tourist destination with many direct and indirect flights from the UK and Europe. Currently there are five airlines offering direct flights from UK airports with this figure set to increase once the new airport opens in 2009, which will allow budget carriers such as EasyJet and Ryanair to fly into the country. Thomas Cook & Thomson Fly offer direct flights from the following UK airports to Monastir: • • • • • • • • •

London Gatwick London Luton Manchester Birmingham Coventry Bristol Doncaster Newcastle Glasgow

The following airlines also offer direct flights from the UK to either Tunis or Monastir airports:

• British Airways • Tunis Air • Nouvel Air Tunisie

Additionally there are many excellent indirect connecting flights from most UK airports to Tunisia via Air France.

BY SEA There are many frequent and inexpensive ferry services from Europe to Tunis, the capital, leaving from Marseille in France and from Genoa, La Spezia, Naples, Palermo and Trapani in Italy. 4

The essence of Tunisia

Many visitors have been drawn to Tunisia for its sunny climate and its bargain beachresort holidays: the white sandy beaches are glorious, the sea a clear turquoise, and some of the resorts are among the best the Mediterranean has to offer. However, this small country has so much more to offer, mostly within easy reach of the coast, and is now at last starting to promote it: friendly people, well-preserved whitewashed medinas, green forests in the north, a vast desert and lush oasis in the south, an amazing wealth of archaeological treasures inland, as well as an exciting and delicious cuisine, based on fresh local produce.

Tunisia is a mainstream holiday destination but it still attracts a lot of first time visitors to the country. Those that visit tend to come back again and again each time absorbing more and more of the culture. In the mysterious medinas, there is the feeling that a thousand secrets lurk behind every studded door; shops and stalls in the souqs and surrounding streets spring to life to serve the homeward bound with the freshest food. Fish are only minutes out of the sea, bread is baking on the spot and stacks of colourful vegetables are haggled over with shouts and handshakes!

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Tunisian Cuisine

Although international food is served in most resorts, many holidaymakers will want to try at least some local cuisine. The Arabs, Turks and French have all had an influence on the country’s cooking. With such a long coastline, fish is given pride of place on any menu and restaurant owners compete with each other to display the freshest catch. Bream, grouper, sea bass and red mullet are amongst the most widely available, while seafood speciality dishes are based on prawns, lobster and squid. In all but the cheapest restaurants customers are nearly always welcomed with complimentary hors d’oeuvres which may be as simple as a bowl

of black olives and some delicious crusty bread. In most places the bread will also be accompanied with a small saucer of fiery red harissa paste made from hot chillies. A popular starter is the famous brik, a unique Tunisian dish which consists of a triangular-shaped envelope of crispy pastry containing a lightly cooked egg, often topped with fresh herbs, prawns or tuna. Couscous is an obvious main course, a tasty vegetable, meat or fish stew served on a bed of steamed semolina grains. Dessert is often a choice of fresh fruit or very sweet pastries like baklava, filled with nuts and honey.

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Northern Tunisia

For a small country, Tunisia offers plenty of variety besides its glorious beaches. The north, particularly around Ain Draham, has large oak forests and lakes, making it feel more like Europe than Africa. Tabarka is emerging as Tunisia’s northern flagship resort, while the charming old port town of Bizerte is still debating whether it really wants to entice international tourists or is quite content to remain a sleepy fishing town. For more than 3000 years, Tunis, the capital has been among the great cities of the Med and it still has plenty to offer.

Carthage is one of the best known of Tunisia’s archaeological sites on the outskirts of the capital. Founded in 814 BC by the Phoenicians, by the fourth century BC, Carthage had become the centre of their vast maritime empire. In 146 BC it was destroyed by the Romans who only 25 years later began rebuilding on the same site to become the 3rd largest city of the Roman empire. Today ancient ruins still remain and are a firm favourite with visiting tourists. 7

Hammamet

Hammamet, the longest established resort in Tunisia has been attracting holidaymakers since the 1960s. Less than an hour’s drive from Tunis airport and only slightly more than that from Monastir airport, Hammamet is geared up to year-round tourism. Easy-going and lively, with a good choice of restaurants, Hammamet’s first hotels were built in the centre close to the medina but shortly afterwards started stretching along the coast almost as far as Neubul, making the most of some of the finest beaches in the country.

10km from the centre is the new resort of Yasmine Hammamet which boasts a large marina with 740 moorings, a walled medina area with covered markets, luxury 5-star hotels, casinos, many Thalasso therapy centres, a theme park and much more. The town offers an excellent promenade lined with shops and cafes, gardens and parks, and entertainment complexes. Two 18-hole golf courses, Yasmine and Citrus are situated only 5 kilometres away from Hammamet. 8

Sousse

Sousse used to be just an excursion destination for day trippers; now it is a busy holiday centre in its own right. Packed with atmosphere and hundreds of years of history, Tunisia’s leading city beach resort offers a great selection of quality hotels, a wide choice of affordable restaurants and endless possibilities for shopping in the traditional markets or the equisite boutiques which rival those of its European neighbours. Along with Carthage, Sousse was one of the Phoenicians’ three great coastal cities, with the earliest archaeological finds dating from

the 6th century BC. The charming medina seen above is the old heart of the city. A popular choice for Tunisians and foreign tourists alike, Sousse is a destination open for business all year round. The beaches stretch as far as the eye can see and the wide promenade is bustling with families enjoying their ice creams and traditional Tunisian sweets. Situated less than 20 minutes away from Monastir airport, Sousse is an excellent choice for a rental investment due to its popularity and year round appeal.

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Port El Kantaoui

Purpose built around a picturesque marina which now draws luxury yachts from all over the world, Port El Kantaoui opened in 1979 and has been Tunisia’s most outstandingly successful tourist centre. With the look and feel of an elite residential district, it is the second home of the President, top politicians, diplomats and the fabulously wealthy. Millions of dinars have been poured into landscaping, with palm trees, shrubs and grass borders immaculately lining every road. The resort’s hotels are equally sparkling; whitewashed palaces with

terraced gardens awash with bougainvillaea. Port El Kantaoui’s pride and joy are its beautifully manicured 18hole championship golf courses. There are no membership requirements and while golfers with their own equipment are welcome, those who prefer to travel light can rent everything they need from clubs to caddies at very reasonable rates. Dubbed as Tunisia’s Puerto Banus, Port El Kantaoui is the most exclusive of Tunisia’s resorts situated only minutes along from Sousse and 30 mins from Monastir.

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Tunisia’s Economy Tunisia has for the past decade been a shining example to other African and Middle Eastern nations on how to grow and prosper as a developing nation. In 2007 the World Economic Forum ranked the country as the number 1 most competitive African economy (29th in the world) with also the highest ranking out of all the countries in the Arab speaking world. Comparing with other nations in the region, Morocco ranked 64th and Egypt came in 77th place out of 131. In the same report, Italy was placed 42nd on the list.

Inflation within the country has remained below 3% for the past 10 years whilst economic growth has constantly been above 5% for the same period. In 1996 Tunisia entered into an "Association Agreement" with the EU which removes tariff and other trade barriers on most goods by 2008.

Tunisia has had to work extra hard to develop its industry and economy to the level it is at today. Unlike its larger neighbours, Libya and Algeria, Tunisia produces very little oil and so the country has had to develop and excel its other industries such as tourism, manufacturing and agriculture. Needless to say that Tunisia's economic reform program has been lauded as a model example by international financial institutions.

Tunisian Economic Facts at a glance

• Highest economic competiveness in all of Africa and the Middle East. • Highest GDP growth rate in Africa • Consistently low inflation levels • Government is very eager to encourage foreign investment into the country • Free trade agreement signed with the EU. • Member of the World trade Organisation and GATT. 11

Why Invest in Tunisia? Considering the strong economic factors you have read on the previous page, you may be asking yourself why hasn’t Tunisia already exploded on the international property market? Well the question is fairly easy to answer. The forward-thinking government wanted to ensure that the Tunisian population wouldn’t be out-priced out of their home market preventing them from buying their homes in their own country, much like has happened in Morocco in recent years. They had prevented foreigners from purchasing property in Tunisia for a considerable length of time and nationals of some countries are still unable to buy there. Once the local home ownership figure neared 80% (higher than in the UK), where it stands today, they introduced an approval system whereby each foreigner would require approval from the Governor of the region before being entitled to buy. This permission still stands today but is pretty much a formality and there are usually never any problems with Europeans buying in Tunisia.

The fact that the home tenure figure is so high in Tunisia is excellent news for the foreign investor as it means that there is a strong local market in place when they need to realise their investments and sell their properties. This is particularly important when dealing with new and emerging markets as investors always need a clear exit strategy and be able to realise their investments when the time is right.

Tunisians are very wealthy in comparison to other countries in the region and the current GDP per capita stands at $8,800. The country is situated only 50 miles south-west of Sicily and this proximity to Europe has enabled them to forge strong ties with the EU which hasn’t gone unnoticed elsewhere in the region. The largest developers from Dubai have recently started to invest very heavily into Tunisia, realising the stability of the country and the proximity to Europe making Tunisia an ideal link between Africa, Middle East and Europe. In the capital Tunis, they are currently investing over $20bn in projects such as Tunis Financial centre and Tunis Sports City based on the popular concepts from Dubai itself. Further south, Emaar, the Dubai developers of the world’s only 7-star hotel are investing $2bn in a picturesque coastal region creating an artificial marina, a world class golf course, exclusive residential properties and a number of luxury 5-star hotels. 12

Why Invest in Tunisia? Tunisia is perhaps best compared to one of their western neighbours, Morocco. Although Morocco doesn’t bode as well as Tunisia in terms of economic growth and stability, UK and European Investors have been buying property there for a few years now and the price of Moroccan property has risen considerably during that time. It is difficult to determine exactly how much prices have risen, as with any emerging market, but reports from developers tend to suggest that the selling price has tripled in some areas. Infrastructure and transportation to and within and the country are excellent as Tunisia offers 7 international airports ensuring that no matter where you are in the country you are never further away than 2 hours from an airport. The largest airport in Northern Africa is currently under construction in Tunisia scheduled for completion in late 2009 which will offer cheap and inexpensive flights with carriers such as Ryanair and Easyjet. Within 10 minutes drive of this airport, the largest deep water port in the southern Mediterranean is also being built enabling the globe’s biggest trade ships and cruise liners to dock in Tunisia. Rental yields are very high in Tunisia and are discussed in detail on the following page. To summarise, below are the key points explaining why you should be buying in Tunisia.

Why buy property in Tunisia?              

Low property prices High Rental Yields Dubai developers investing heavily High rate of growth Low rate of inflation Most stable country on the continent Very cosmopolitan society Modern thinking nation Excellent relations with EU Relaxed restrictions on foreign ownership Fantastic Infrastructure Many direct flights from the UK & Europe 3 hours from UK / less than 2 from Europe Great weather all year round 13

How is the credit crunch affecting Tunisia? Tunisia seems to be one of the few countries around the world which seems to have escaped relatively unscathed from the global financial crisis which is affecting so many other developed and developing economies around the world. Gross Domestic Product in 2008 is estimated to have increased by 23.53% from the 2007 figures; in real terms an increase in GDP growth from 5.1% in 2007 to 6.3% is expected in 2008 (Source: CIA World Factbook). Direct foreign investment in the country has gathered pace with billions currently being invested by Dubai property groups, whilst giant corporations such as Airbus have also been relocating their production facilities from Europe to Tunisia, benefiting from a highly skilled workforce and savings of €1 Million per day on their operating costs. Tunisia’s excellent relations and the free trade agreement with the EU is ensuring that other corporations in similar positions to Airbus will follow their lead in order to maximise their profits and streamline their costs. Additionally, since the Tunisian Dinar is a closed currency for now, Tunisian banks have not been exposed to American toxic debt which has engulfed the worldwide banking sector, ensuring that lending within Tunisia to local businesses and Tunisian people is completely unaffected and not harming its economy. The Tunisian Dinar is expected to become fully convertible at the end of 2009 and it is predicted that once it happens, loans to foreign buyers will become available ensuring added demand for property in Tunisia.

How is the Tunisian property market being affected? Although Tunisia is well insulated from the worldwide toxic debt, it attracts property buyers from all over the world including regions which have been affected by the credit crunch. Fortunately, the client base for property in Tunisia is well diversified and not reliant on British or Irish markets unlike most other European and North African property hot spots. Buyers of Tunisian property come from all over the world, from Australia to Canada and South Africa to Scandinavia. A large number of Middle Eastern investors have been attracted due to the stability of the country and the exposure created by multi-billion UAE investments. Additionally, unlike with most other emerging property markets, there is large domestic demand for property in Tunisia as Tunisians at home and those living abroad are seasoned property investors. This means that as well as attracting local demand for offplan property, there is also a secondary market to which foreign buyers can resell their properties when the time comes to realise their investments. This in itself is a major plus 14 point as emerging markets typically do not attract much local demand for property.

The Rental Market The rental market in Tunisia is very strong due to the high domestic demand for rental accommodation in addition to the demand from Europe and Tunisia’s neighbours Algeria and Libya. Furthermore, due to the country’s location, Tunisia benefits from all year sunshine ensuring the rental season is much longer than in Europe. In fact, over the past years temperatures in early spring have been recorded as high as 40 degrees Celsius, however most of the time they are in the region of 25C to 35C. Having the highest home-ownership rate in Africa and certainly one of the highest in the world, Tunisia is a middle-income country which has outperformed most of its African neighbours both in terms of economic growth and political stability. As a result of their relative wealth, the Tunisian people are able to take frequent holidays in the most popular regions of Tunisia such as Sousse and Hammamet boosting the demand of the rental market. Tunisia’s larger neighbours, Libya and Algeria do not offer tourist facilities, resorts or hotels anywhere near the scale that Tunisia does, and as a result many Libyan and Algerian nationals tend to take their holidays in Tunisia boosting the demand for rental properties even higher. Last, but not least, we have the European contingent of holiday makers who arrive in Tunisia in their millions each year looking for a warm, sunny climate to spend their holidays. Being less than 3 hours from the UK and most of Europe, Tunisia offers something new and exciting for everyone and has been an established tourist destination with Europeans over the past 2 to 3 decades. Tunisian weather chart from the BBC website

Generally, tourists who visit Tunisia tend to come back year on year, and those on their return trips will prefer to rent accommodation giving them more flexibility than a hotel does. As a result, there is considerable demand for rental properties all year round. In the summer, couples and families with younger children tend to visit the country whereas in the winter we see a lot of retirees and Golfers in particular. Whatever they are looking for, Tunisia offers it all!

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Rental Expectations We have carried out a comprehensive survey of a number of different rental agencies located in Tunisia and abroad. The following rates are based on durations of one week and split into 3 seasons, low, medium and high. The resorts considered are the most popular ones with holiday makers, and the rental stock comprises of apartments currently available to rent in 2008. Low Season Medium Season 1st Nov - 31st March 1st April - 15th June

High Season 16th June - 14th Sep

15th Sep - 31st Oct 1-bed Apartment 2-bed Apartment

€ 280 € 350

€ 340 € 435

€ 390 € 550

The difficulty with comparing rental potential of existing properties to those of The Dunes Golf & Spa Resort is that currently there are no other true 5-star resorts in Tunisia offering all of the below:  24hr gated security  Spa centre on-site  2 swimming pools  Supermarket and Café on-site  On-site rental management agency  Exclusive private beach for residents ONLY  20% residents discount on Spa and Golf facilities  All-inclusive optional Platinum service As a result, we believe that there will be a minimum 15% premium (excluding price inflation over the 2 year build time) on top of the above quoted prices for the Dunes Golf & Spa Resort giving us the expected rental figures found below.

Low Season

Medium Season

High Season

1st Nov - 31st March

1st April - 15th June

16th June - 14th Sep

15th Sep - 31st Oct 1-bed Apartment

€ 320

€ 390

€ 450

2-bed Apartment

€ 400

€ 500

€ 630

*Some of the rental agencies surveyed: holidaylettings.co.uk, locasun.co.uk, villarenters.com, rent-holiday-homes.com

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Return on Investment Using the rental figures on the previous page, we can work out the annual rental yield on the properties. We will make the following assumptions:

Rental Yield     

Property is a 1-bed apartment priced at €52,000 Property is rented out for 22 weeks per year 12 weeks rental in the peak season at €450 per week 8 weeks rental in the medium season at €390 per week 2 weeks rental in the low season at €320 per week

Total annual rental return = €9,160

Gross Yield = €9,160 / €52,000 = 17.61% Net Yield (gross yield minus 10% rental management charge) = 15.85% Time taken to pay off the property = 100 / 15.85 = 6.31 years * Weekly rental estimates provided by Well Placed Apartments Ltd.

The above figure shows us that by assuming your apartment is only rented out for less than half a year you are able to pay off for the property in just over 6 years using rental income alone. Below we examine the potential capital growth using the same apartment.

Capital Growth    

Current price €52,000 Initial Investment (before completion) of 50% = €26,000 Appreciation during construction of 25% per year Value of apartment on completion in 2 years = €81,250

Profit of €81,250 - €52,000 = €29,250 is made during construction alone. Since only €26,000 was invested, the return on capital invested in only 2 years is =

112%

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Development Overview Situated on Tunisia’s “Gold Coast“, within easy reach of its most exclusive resort, Port El Kantaoui, The Dunes Golf & Spa Resort is a beachside development situated conveniently between two of Tunisia’s busiest airports offering direct and inexpensive flights to major European cities. The development itself comprises of studios, one, two and three bed apartments in a low rise setting in a prime residential area close to all facilities including a 36-hole golf course, marina and restaurants. The Dunes Golf & Spa resort is directly located next to glorious white sandy beaches that stretch as far as the eye can see. The resort offers on-site world class Thallasso Spa facilities including an indoor swimming pool, Turkish baths, a sauna, gymnasium and beauty & massage treatment rooms with discounts for residents. One can enjoy a massage on the exclusive private beach set aside for residents only or play a round of golf at the finest African golf courses located on your doorstep. The Dunes is a gated 5 star resort offering 24hr security and concierge facilities as well as on site amenities including a restaurant, snack bar, supermarket, bank, bakery and a rental management company. Rental income is very high in this region due to the strength of the local, neighbouring and European markets ensuring yields are between 10% and 14% per year.

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Development Facilities  5-Star beach, spa and golf resort  100m from an exclusive private beach for residents only with sunbeds and umbrellas  On-site 1st class Spa facilities with 20% discount for residents  Gated community  24hr Security and Concierge  Underground and off-street parking  Two outdoor pools with lounge facilities (one adult and one children’s pool)  Whirlpool Jacuzzi  Poolside cabana bar  Indoor pool in the Spa centre  On-site rental management agency with only 10% fees  Laundry and cleaning service from as little as €1 per hour  Optional Platinum service for seniors offering full services including airport transfers and welcome packages  Satellite Television  Video Entry System  Private beach  Electrical and water connection included  Low community fees  Show flat on-site

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Close-by facilities           

On the doorstep of two world class 18-hole golf courses 20% Golf Discount Card for residents Water Sports/Fishing/Diving and Boat excursions running all year around Cultural excursions including Arabian nights and Belly dancing shows Shopping centres Excellent international cuisine Palm tree lined promenades Children’s water and theme parks including a petting zoo Horse and camel riding Hospital and Pharmacies nearby Traditional Medina offering bargain shopping Payment terms €3000 euro reservation 50% on contract 10% six months after reservation Balance on completion in June 2011 Due to the low property prices, one can easily obtain a personal loan for the first 50% with payments as low as £75/€95 per month.

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Property Specification                

Stainless Steel door handles Phonic and Thermic isolation between floors Aluminum external carpentry with rolling blinds manufactured in Germany Outdoor solar lighting throughout the project Excellent interior carpentry First choice sanitary and electrical equipment and fittings Pre-installation for hot and cold air conditioning throughout the apartments Pre installation for washing machine Italian style kitchen including hob and extractor, stainless steel sink and fridge freezer Anti slip ceramic tiles in kitchen and bathroom Fine Tunisian marble floors in lounge, bedrooms and corridors Satellite Television with over 5000 channels 24-hour security Underground and open-air car parking Facilities on site include a supermarket, bank, bakery, cafe/bar and a management company Freehold Landownership Certificate

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Image Gallery

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New investment concept – Modular Studios Studios within the Dunes are designed to be modular allowing investors the possibility of combining two, three or more studios together in order to offer the highest potential for rental income and excellent capital growth whilst at the same time minimising the risk to shrewd investors.

New investment concept – Modular Studios Studios within the Dunes were designed to be modular allowing investors the possibilities of combining 2, 3 or more studios together in order to offer the highest potential for rental income and excellent capital growth whilst at the same time minimising the risk for shrewd investors. By introducing a simple connecting door in between adjoining studios upon completion, investors are able to rent out studios individually when required whilst at other times the property can be used as a fully functioning one or two bedroom apartment with each bedroom having its own en-suite facilities. This type of investment ensures that each owner of these modular studios is able to capitalise on changing rental demand throughout the year, whilst at the same time ensuring that each studio can ultimately be resold as a separate unit hence benefitting from the highest rental & capital appreciation potential out of any other apartments in the Dunes Golf & Spa Resort..

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