Buy Low: Adrian Gardiner discloses why 12J Pearl Valley Hotel’s can offer such amazing value for investors

In this special interview with Adrian Gardiner, the founder of global hospitality group Mantis explains why 12J qualifying Pearl Valley Hotel is able to offer such incredible value to investors. That includes a guaranteed 6% p.a. return for the first two years. And free nights of use for each unit purchased, which also be swapped for nights at other Mantis properties. Plus member’s rights at SA’s Number Two rated golf course. Reason? It’s all about the entry price. Gardiner’s group and partner Val de Vie bought the hotel in the trough after the 2008 Global Financial Crisis. This is a must-listen for high income earners looking to take advantage of the 12J tax incentive window which closes on June 30. As Gardiner puts it, there’s a painting that investors need to hang on the wall in the next month – or lose forever.

For more information on this investment, click here.

Adrian Gardiner on how the Pearl Valley Hotel 12J investment came about:

It is a pity that it is coming to an end, because I think it’s been an incentive for people – and certainly in our industry. We’ve managed to give returns when we’ve had people invest with us. I think it is quite sad that it’s come to an end. How we got involved; you do the 12 J through a recognised organisation and we partnered with Futureneers, who then came to us with this idea. We did a Phase 2 and some of Phase 1 of the hotel on 12J. It’s been most efficient and effective, for both our product and the industry.

On the Pearl Valley Hotel 12J investment:

I’ll tell you what I think is the most interesting thing. When we sold Phase 1 of Pearl Valley, the starting price was R1,250,000. Then, the last few were sold for R1.5m. the Pearl Valley price now is up to R2.3m. The capital growth in two years – at maximum three years – is almost R1m, if not more. Besides the return that you’re getting, the capital growth has been phenomenal.

On what you get for your investment:

It’s a sectional title scheme. If you put a million in you’d own a share in a company that owns various hotel rooms, because the room is selling for R2.6m (including all 12J fees and costs). That means that the owner of that room, we also give 10 day occupancy per year. You pay a very nominal fee (for cleaning and breakfast), but you’ve got 10 days that you can occupy that room, as the owner. Besides that, you can take those 10 days and use a certain number of them – if the rooms are available – at Simbithi or at the Links, when we develop that.

So, you can swap your room usage around. We’re also going to see if we can swap that room usage to our other products, such as our Zambezi Queen Collection. To be involved with us in this development stage, I think, for anybody who wants to invest in a hotel room, it’s far better to invest with us at Mantis who can offer you many different offerings in our portfolio over the world.

On how you earn money on your investment:

What we’ve done for the first two years of your investment, we’ve underwritten the 6% p.a. return – which is quite hard for us in these Covid times. Plus, the fact is – and I don’t want investors to forget this – that there’s a substantial capital growth in your room, that we can prove already. I think that there’s quite a lot that we can offer. The other concern that people had is, “how strong is my investment?”

First of all, you’ve got a title deed because you own that room. It’s not a case of, “is Mantis going to make it or not?” Your room is your room. I think that with Mantis, your investor has probably got a very secure occupancy. Three years ago, we sold 50% of our brand to Accor, the second biggest hospitality company in the world, which now gives us access to an incredible distribution system which all those people will have access to. It [also] gives us access to a loyalty programme. The third and most important thing in my life at the moment, is that we are part of a community conservation fund, which we started with Accor. Your people can also be involved in looking at what we are doing there and making a difference to the environment and the community. We just feel that anybody that joins us, is joining a company that has far more than just a hotel room – an offering – but can offer so much more in terms of lifestyle.

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For more information on this investment, click here.

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