Before the Australian venture, did SANAD have any major real estate interests – especially in freehold – in the UAE? Or was your role in UAE’s real estate more of an investor?
I think it’s been two years since the announcement of the Australian project – how far has it progressed on the development side? Is there a freehold element to it?
The project has progressed significantly since its announcement two years ago. ACTVENTURE will be the first action lifestyle destination in the world. We decided to invest in Australia’s Sunshine Coast because of its immense potential as a tourist destination that perfectly resonates our brand of active and healthy living.
Actventure controls all of the land including both freehold and leasehold elements. This creates flexibility for us when discussing various elements of the project, such as the Hotel, with joint venture partners.
What is unique about ACTVENTURE is its combination of a state of the art water park with a family oriented hotel and a range of active outdoor sports and activities that meshes very well with our environment and lifestyle on the Sunshine Coast. The design includes the six hectare waterpark, 6,000 square meters promenade of retail and restaurants, the ACTVENTURE Tower and Great Lawn.
So our progress has been swift. We have now completed full master planning with the Thinkwell Group, the world’s leaders in theme park design. We have competed the water park design with Whitewater West, the world’s leading water park design consultant. We have approval to build an integrated tourism resort, and ‘development approval DA’ from the Sunshine Coast Council, the region’s authority, for 70% of the site in the initial stage, and a bulk earthworks approval for the total site. This enables us to start moving earth within the next couple of months.
Or is the location being used exclusively for hospitality and entertainment features?
ACTVENTURE follows an integrated action lifestyle destination strategy that we developed to fill a niche that we believe is growing. Not only in Australia, but globally. The core of our offering is lifestyle in nature, from our hospitality facilities to our entertainment platforms.
Have you tied up with any developer in Australia to take this venture to reality? Will you be bringing on board strategic investors during the lifecycle of the project?
SANAD will take on the role of overall project developer. We are now in the final stages of deciding on a contractor to conduct bulk earthworks, a will 150,000 cubic metres of cut and fill, including a new lagoon area and the beautification of the existing waterways, and immediate preparations for Stage 1 of construction, and all future stages. We will always work with the best of what we can find locally, and the best we can find internationally. To that end, we put together an Advisory Board make up of top global executives who will serve as expert advisors to the company.
Simultaneously, we are in talks with some individuals and institutional investors about ACTVENTURE. We participated in a road show in Asia promoting ACTVENTURE to potential strategic investors organized by Colliers to Singapore, Shanghai, Chengdu, Hong Kong and Guangzhou, with PwC and The Commonwealth Bank of Australia
How many phases will it have? When will the first couple of phases be complete? Will this be the hospitality portion?
Phase one will consist of a state of the art waterpark, a great lawn for major events, an outdoor adventure tower, and a 6,000 square meter retail zone set to attract leading local and global brands along with a superb choice of restaurants. After collaborations with leading global companies such Jones Day, EY (Ernst & Young) and others, phase one of the development was approved by the Sunshine Coast Council in February 2017.
Phases two and three of the project will be submitted to the Sunshine Council in 2018, and include the 225 room family hotel with conferencing facilities, an action sports precinct with world class facilities for skateboarding, BMX biking, and the much anticipated ‘Wave Reservoir’, another first for Australia and the Sunshine Coast.
One would have thought Australia already has enough of water-side attractions – wouldn’t you say it is quite a mature market to get into for greenfield development?
Believe it or not, the Australian market has minimal offerings in the theme park and water park industry compared to the international market. There are a number of small operations but very limited in terms of offering and products provided to the public. At the same time, the Sunshine Coast has a fast increasing tourism market currently increasing by 11.4% per annum and there is a huge demand for major new tourist attractions. It is within a close proximity to the major city of Brisbane and the average temperature is 26 degrees year round. These factors make the Sunshine Coast a unique and attractive place to holiday for international visitors and the perfect place for a major tourist attraction like ACTVENTURE.
What will be the combined investments into the project?
The total investment in the project is set at AED1.2 billion.
Are you considering any others elsewhere at this point?
We are looking at the UAE to lunch the second ACTVENTURE. The country’s leisure and entertainment industry is forecast to reach 45 million visitors a year by 2021, and we are very interested in participating in this growth. We convened our advisory board meeting in Dubai to discuss potential locations and partners for a UAE roll out. Other global sites are being considered.
Given that major parts of the project are given over to entertainment, how long will the return on investment take?
Based on a conservative financial model completed by a major international accounting firm, we anticipate solid profits in the first year of operation, increasing substantially over the following years with a full ROI within 4 years from operation. The model also shows a potential IPO within this time frame once international sites kick in, which increases the ROI significantly.
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