PPP Business Plan 09 03

value of the company
The method we deem appropriate to adopt is the mixed approache because it is the most widespread model:
“mixed method of equity-income”
Application of the method
Market Value of the Asset
As of March 2015 the Asset has been valued by an independent appraiser at: Euro 30,000,000.00 (euro thirty million).
It is noteworthy to point out that the Asset has a benefit from Historical Tax Relief such as extremely low Annual Property
Taxes (approximately $15,000 per annum).
Refurbishment project
(See Refurbishment project chapter, page 103)
Summary of the cash investment:
• Architect and Designer Project:
• All Refurbishment costs, Including Improvement, Build-Out and Furniture:
• Development Start Up Expensive
• Five months Working Capital
• Total
$1.5 MM
$2 MM
$1 MM
$1.5 MM
$6 MM
Value of the Business
Based on the method adopted which foresee the average of the Asset Value (K) and the income value with unlimited capitalization
(R/i):
W=1/2 (R/i+K)
An additional reason why this method has been used is based on the fact that the Asset (Palazzo Albertoni Spinola) is
not changed in a way to be transformed into accommodation/touristic/hotel activities; instead it remains from a cadastral
standpoint a private residence with a simple authorization provided, in accordance with the following regional regulations:
• Regional Regulation, October 24/2008 n. 16
• BUR November 7, 2008, n. 41, S/130
• Regulation for non-hotel Accommodation Facilities:
• The urban requirements of residential type remain completely unaltered, and so are the destination and the use of individual
residential apartments, as well as the independence of the individual real estate units.
• Thus even if we adopted it here in a conservative manner, the following assessment shows an unmotivated halving in value
of the transferred asset.
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