Unlock More Upside
All capital participation is facilitated through our lead entity, which controls the buyer position and execution rights. We welcome aligned investors into this structure — no outside offers or repositioning can occur without our control.
Presented by:
Charl Hattingh (Sponsor)
a Structurally sound, prime-located hospitality property with the potential to evolve from a private villa, to a boutique hotel, and ultimately into a full destination resort.
Villa Castollini
Luxury Hospitality Investment – Value-Add Opportunity
Single-Asset | Institutional Refinance & Equity Tail
Purchase Price: R56 million (Confirmed sale agreement)
EXECUTIVE SUMMARY
Under contract: Villa Castollini, a 10-key guesthouse + ancillary operations
Structurally sound, but underperforming relative to intrinsic demand
Opportunity: operational optimisation + expansion to 30 keys, F&B and event monetisation
Strategic Capital Injection: R36m (2.23M USD)
Accelerate 30-key expansion and F&B monetisation
Enable clean institutional refinance at 50–60% LTV
Investor return: Refinance + 7% exit premium +
Equity Participation
Base Case:
• R36m for 25%
• 8–10% preferred return
• 7% exit premium on refinanceStrategic Acceleration Case:
• R36m for up to 30%
• Only if investor funds:
– Full VAT bridge
– Full DSCR buffer
– Immediate expansion capexEquity flexes with speed, certainty, and cheque size — not with risk.
Location & Asset Overview
Prime location, high tourism demand
Existing 10-room guesthouse
Existing F&B: Zabella’s (temporarily closed) + bar + Sunday market + small events
Touring contracts in place
Zoning / building plans allow Boutique Hotel conversion (30 keys)
Underperformance = Opportunity
Why this is a textbook value-add
Guesthouse occupancy below potential
Zabella’s temporarily closed due to small team
F&B income limited to guesthouse operations
Bar, touring, nursery & market underdeveloped
Venue / events underutilised
Current Performance vs. Institutional Potential
Trailing 12 Months (As-Is, Constrained Operations)
NOI: R6.3m
DSCR: 0.86x
Stabilised Run-Rate (Operational Normalisation Only)
NOI: R8–10m
DSCR: 1.3x–1.6x
Post-Optimisation & Expansion (Already Zoned / Designed)
NOI: R14–20m+
DSCR: 2.0x–2.8x
The current financials reflect operational constraint, not asset potential.
The property is structurally capable of generating R14–20m+ in NOI under normalised hospitality operations, without relying on market growth or aggressive assumptions — only execution.
This is not a turnaround. It is a normalisation and scale story.
With the reopening of F&B, event monetisation, touring scale, and 30-key conversion already permitted, the asset mechanically re-rates from a R4m NOI operation to a R14–20m+ NOI institutional hospitality platform.
Investor Takeaway:
Minimal operational tweaks yield large upside
No speculative market assumptions – purely execution-driven
Value Creation Levers
Reopen Zabella’s fully (R15–20k/day)
Expand Touring groups (+R3m p.a.)
Revitalise Sunday market
Bar optimisation
Launch nursery + hanging garden tea café
Minor operational and branding capex
Hospitality Students
Synthetic Icerink
Expansion to 30 Keys
Current: 10 rooms
Planned: 30 boutique suites
20 Student Units
ADR: R2,500 conservative
Occupancy: 65% projected
Revenue uplift drives institutional valuation re-rating
Revenue Build-Up (Stabilised & Upside)
Revenue Stream
Base Case
Stabilised
Post-Upgrade
Guest House / Rooms
8,000,000
9,000,000
17,800,000
Zabella’s F&B
4,500,000
6,500,000
7,000,000
Touring Groups
3,000,000
3,000,000
3,000,000
Bar
1,500,000
2,000,000
3,000,000
Extra Rooms / Suites
3,600,000
3,600,000
3,600,000
Sunday Market / Venue
250,000
500,000
500,000
Nursery / Tea Garden
-
1,200,000
1,500,000
Nursery / Tea Garden
-
1,200,000
1,500,000
Total Revenue
20,850,000
25,800,000
36,400,000
NOI
4,224,000
8,300,000
14,400,000
Valuation @ 9.5% cap
58,000,000
90,000,000
152,000,000
This is not a market-reliant growth story — the upside is driven by reopening existing profit centres, modest capex, and executing on already-approved expansion to 30 keys
Post-Investment Capital Structure
Senior Bank (Target Refi): 50–60% LTV
Strategic Equity Partner: R36m up to 30%
Founder / Sponsor: Retains 70% with control
Seller Note: Eliminated (risk compression)
By collapsing the capital stack and removing subordinated complexity, the asset becomes immediately bankable, refinanceable, and scalable.
Capital Structure & Bank Gap
Senior Bank Debt: structured after stabilisation
Short-term gap for DSCR coverage & SARS VAT bridge
Strategic Capital Injection: R36m (2.23M USD)
Structured to:
• Replace subordinated seller exposure
• Solve DSCR and VAT timing permanently
• Accelerate 30-key expansion and F&B monetisation
• Enable clean institutional refinance at 50–60% LTV
SARS Bridge Logic
R8m bridge to cover VAT timing mismatch
Fully reimbursed in 60–90 days
Reinvested immediately into:
Room upgrades
F&B and Zabella’s reopening
Marketing acceleration
Operational liquidity buffer
Refinance Strategy
Refinance at 18–24 months
Conservative valuation: R110m
Senior debt: 60% LTV → R66m takeout
Downside Institutional Case (50% LTV):
Valuation: R110m
Debt: R55m
Investor Capital Repaid in Full
Founder Still Retains Majority
Equity Tail Rolls ForwardUpside Case (Post-Upgrade):
Valuation: R150m
Debt @ 55%: R82.5m
Investor fully cashed out + premium
30% equity worth ±R45m
Financial Model
Revenue Stream / Base Case / Stabilised / Post-Upgrade
NOI R6,388,000 (Base Case)
NOI 8,300,000 (Stabilised)
NOI 14,400,000 (Post-Upgrade)
Valuation @ 9.5% cap
58,000,000 (Base Case)
90,000,000 (Stabilised)
152,000,000 (Post -Upgrade)
Investor Waterfall & Returns
Metric
Amount (ZAR)
Notes
Investor Equity In
R36,000,000
50% acquisition capital + SARS VAT bridge + stabilisation & capex
Stabilised Valuation (Conservative)
R110,000,000
Based on normalised NOI and 9.5% cap rate
Senior Bank Refinance @ 60% LTV
R66,000,000
Institutional take-out post-stabilisation
Senior Debt Repayment
(R36,000,000)
Full investor capital repaid
Cash Premium to Investor
R5,000,000 – R7,000,000
Target 14–20% total return on capital over ~18 months
Investor Equity Rollover
30%
Permanent stake in re-rated hospitality platform
Implied Equity Value @ Refi
R33,000,000
30% of R110m
Total Value to Investor
R74m – R76m
Cash-out + retained equity
Equity Multiple
2.0x+
At refinance
Target IRR
28% – 35%
Driven by short duration + valuation re-rating
Ongoing Cash Yield
8% – 12% p.a.
On retained equity post-refinance
If you want more equity, you bring more capital — and the return profile scales accordingly.
Risk Mitigation
Seller remains invested via subordinated tranche, aligning interests and providing structural downside protection
DSCR / Stabilisation capital ring-fenced in escrow, ensuring uninterrupted debt service during ramp-up
SARS VAT bridge contractually secured with defined reimbursement timeline (60–90 days) and first-use application to asset enhancement
Hard real estate collateral with replacement-cost support and conservative re-rating assumptions
Defined refinance take-out plus permanent equity tail provides both liquidity and long-term yield, reducing execution and exit risk
Exit & Upside
Targeted refinance at ~18 months (24-month outer buffer) as primary liquidity event
Optional sale post-stabilisation / boutique conversion
Perpetual equity tail provides ongoing passive income
Target NOI post-upgrade: R12–14m
Valuation post-upgrade: R120–152m
Strategic Alignment & Next Steps
This opportunity is best suited for a capital partner who:
• Values asymmetric downside protection
• Understands hospitality operational leverage
• Seeks hard-asset USD-hedged exposure with equity compounding
• Is comfortable leading the capital stack and setting terms
The structure is intentionally flexible to allow the right partner to shape:
• Final equity participation
• Preferred return mechanics
• Refinance and expansion sequencing
Our next step is to open the data room and allow you to define the structure that best aligns with your return profile.
Why Now
Why This Window Is Mispriced
• Asset trading at sub-institutional multiple
• Operational upside not yet capitalised
• Seller complexity creates temporary inefficiency
• VAT timing creates artificial stress
• Expansion rights already approved
• USD capital enjoys FX arbitrage on entry
You are buying dislocation, not just a hotel.
We are not looking for capital alone — we are looking for a strategic balance-sheet partner who sees the same institutional trajectory and wants to help architect the capital stack that unlocks it.
All essential information has been consolidated into the business plan for clarity and efficiency
Click the ‘Business Plan’ button to proceed to the next page to review the full proposal (instead of providing various attachments)
Signed Contract
· Business plan and acquisition rationale
· Three years’ audited financials (trading history + occupancy rates)
· Renovation and/or addition costings
· My professional CV and experience background
· Details of foreign investments or similar assets previously managed
· Personal statement of assets and liabilities
· Entity/company documents in which the funding will be structured
· Confirmation of own contribution source
· Property valuation summary
Charl Hattingh
Born and raised in SA, combines international structuring
with deep local insight - hospitality & real estate investor in
New Zealand, Australia with active SA expansion.
Founder, Investor Liaison & Strategy Lead
Meet Your Team
We’ve identified the following key roles critical to the success of this conversion and repositioning. These will be filled by a combination of direct hires and strategic partnerships upon closing:
Founder & Principal: Charl Hattingh, driving vision and execution
Hospitality Lead: To be appointed — candidates with boutique hotel experience engaged
Financial Oversight: Shortlisting 3 reputable SA-based accounting partners
Construction PM: Industry-vetted local operator pending terms
Compliance & Legal: Consultation secured with hospitality-focused firm
Brand & Revenue Lead: In-house or agency role depending on phase
To ensure a seamless transition and sustained performance, we will retain select key staff from the current Villa Castollini team.
These team members bring valuable on-the-ground experience, supplier relationships, and hospitality know-how — providing immediate operational continuity.
Oversight and strategic direction will be led by Charl Hattingh and our leadership team, who are responsible for executing the repositioning, capital upgrades, and financial optimization.
Let’s Talk
Join Us In This Ground-Floor Growth Opportunity
Let’s schedule a 15-minute call to walk through the structure and alignment.
Only a small number of investors will participate in this phase.
FAQs
Your Questions Answered: Quick, Clear Commercial Real Estate Guidance.
Why is the asset underperforming, and is it really fixable?
Villa Castollini is structurally sound: premium location, approved zoning for 30-key boutique hotel, existing operational infrastructure.
Underperformance is purely operational: Zabella’s was closed due to a small team, touring contracts weren’t fully leveraged, F&B & market opportunities were underdeveloped.
Execution plan: Reopen Zabella’s, expand touring contracts, optimise F&B & bar, minor capex to improve rooms and amenities.
Comparable benchmarks show NOI uplift of 2–3x is realistic, and bank underwriting confirms stabilised cashflows are credible.
Its current vs intrinsic revenue potential, highlighting that the upside is operational, not speculative.
How secure is my capital? What happens if cashflows underperform?
Capital is structured in escrow / DSCR bridge to cover near-term debt obligations.
SARS VAT bridge is reimbursable in 60–90 days and recycled into operational upgrades.
Seller has subordinated finance in place — rare in SA — which enhances capital efficiency and reduces senior exposure.
Any early shortfall is fully covered by the escrowed stabilisation bridge, ensuring investor is protected until NOI stabilises.
Capital in → escrow → upgrades → refinance → repayment, showing all cash paths and safety nets.
How realistic are the revenue projections for rooms, F&B, and tours?
Guest House: R8m baseline; expansion to 30 rooms, ADR conservative at R2,500, occupancy 65%.
Zabella’s F&B: previously R4.5–6m; fully reopened and staffed, projected R6.5–7m.
Touring contracts: already secured, +R3m p.a.
Bar, Sunday Market, Nursery/Café: conservative projections based on operational benchmarks.
All projections are supported by signed contracts, market comparables, and existing bookings.
I can show historical 2024–2025 revenue performance, and highlight that 2025 already exceeds 2024, confirming trend stability and 2026 projected even better!
What if the refinance doesn’t happen as planned?
Refinance scenario is conservative, using stabilised NOI and 9.5% cap rate.
The property has multiple value drivers: operational NOI, boutique conversion rights, ancillary F&B & tours.
Even if refinance occurs at the lower end, investor capital is protected by subordinate structure + escrowed stabilisation bridge.
Bank underwriting confirms asset meets DSCR and LTV requirements once optimised.
I can prepare a sensitivity table showing IRR / equity multiples if refinance valuation is ±10–15% lower.
What is the investor’s ongoing upside after repayment? Is there real passive income?
Post-refinance, investor retains 7% permanent equity in the property.
NOI post-upgrade: R12–14m; 7% equity = R840k+ p.a. cash yield (conservative).
Property is in a prime location, with institutional-grade re-rating potential; equity tail provides long-term asymmetric upside.
Any further revenue growth (additional tours, F&B, events) flows directly to investor equity.
Projected cash-on-cash yield from equity tail alongside refinance repayment, showing blended return and IRR over hold period.
Who will operate and manage the asset post-acquisition?
Experienced operations team already identified for immediate takeover.
Key roles for F&B, touring operations, bar, and boutique hotel management are either recruited or contracted.
Owners / current management will provide transitional support during the first 30–60 days.
Execution plan includes weekly KPI tracking and monthly reporting to investor.
Are all permits, zoning, and approvals in place?
Zoning already allows 30-key boutique hotel and public restaurant operation.
Building plans for expansion already submitted and approved.
All current operations compliant with local regulations, environmental laws, and tourism licensing.
What about market / tourism risk?
Asset located in a high-demand South African coastal area with strong international and domestic tourism trends.
Touring group contracts secured: R3m/year locked in.
F&B and bar income partially independent of accommodation, reducing revenue volatility.
Expansion & boutique conversion further diversifies revenue streams (rooms, F&B, events).
Historical occupancy and revenue trends, plus signed touring contracts can be provided to show base-line cashflow stability.
What are the capex and upgrade risks?
Capex requirements are modest relative to upside: minor renovations, Zabella’s reopening, tea garden / nursery, room upgrades.
R8m SARS VAT bridge can also be recycled to cover any early cashflow needs.
All upgrades scoped with fixed-price quotes where possible.
Upside ROI calculations are conservative and do not assume aggressive market growth.
How liquid is my position after refinance?
Refinance at 18–24 months provides full repayment of capital + premium + accrued interest.
Retained 7% equity generates ongoing passive income from NOI.
Optional future sale of boutique hotel possible at 2–3x stabilised investment, giving another liquidity event.
Conservative scenario stress-tested to show investor capital is protected even if NOI is 10–15% lower than expected.
