Earn & GROW MODEL
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Great location & Growth Market
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EARN: Reliable Revenue Model
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GROW: Increase in Asset Value
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PROTECT: Proper Maintenance
Realistic earning scenario
THE STUDIO
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Rate: $83-150
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AVG RATE: $123
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EARN: $14 800
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RETURN: 7 years
ONE-BEDROOM
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RATE: $135-240
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AVG RATE: $198
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EARN: $21 970
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RETURN: 7 years
TWO-BEDROOM
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RATE: $180-320
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AVG RATE: $265
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EARN: $29 300
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RETURN: 7 years
GARDEN VILLA
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RATE: $280-500
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AVG RATE: $410
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EARN: $47 800
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RETURN: 7 years
BEACHFRONT VILLA
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RATE: $330-585
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AVG RATE: $483
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EARN: $57 090
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RETURN: 7 years
In the next sections, we will look into the hotel (EARN) business model, revenue, and cost structure based on our experience from managing The Nest Boutique Resort in Zanzibar. We have reviewed different scenarios based on official historical data. Following we have analysed how have similar markets developed in order to forecast value increase (GROW). Finally, it is important to properly maintain the properties in order to preserve the value of the asset.
Great Location & Growth Market
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Beachfront Property
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Landmark location - Next to the Rock restaurant
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Tropical island in growth market
EARN: Reliable Business model
Based on 365 days of sunshine, the average occupancy in Zanzibar varies between 55% and 70%. Well managed properties earn well for their owners. Our experience from The Nest Boutique Resort allows us to manage:
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Marketing & Sales
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Lodging Facility's Operations
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Recreation
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Entertainment
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Food services
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Accommodation maintenance
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Administration, Accounting and Staff Management
YOU SIT BACK & EARN AFTER TAXES
The rates we have budgeted are 20% less than the neighboring hotels. The occupancy is based on different island-wide models that we have seen work in The Nest Boutique Resort already. Let us look at the Occupancy.
The market is showing tremendous growth over the past few years, almost doubling in size in the 5 years before COVID 19. Preliminary data for 2022 shows growth over 2019 (pre- COVID) tourism levels. This delivers exceptional occupancy levels.Â
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Average tourist stay: 7.8 days
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Number of beds : 15 000
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Average occupancy: 2019 75%
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Average occupancy: 2021: 56%
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Preliminary results of 2022 show full recovery
The profit model is based on our experience in running hospitality and on industrywide standards. Rates are based on conservative rates compared to neighbors in our competitive mix in order to guarantee occupancy results. This is the cost model:
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56% Occupancy (2021)
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HOTEL ROI 13-14%
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Return 7 years
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72% Occupancy (2019)
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HOTEL ROI 16-17%
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Return 6 years
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48% Occupancy
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HOTEL ROI 10-11%
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Return 10 years
GROW: increase in asset value
The Zanzibar market is quite early stage in terms of maturity. A good benchmark market is Mauritius:
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2009: Price per sq. m. $2400 (studio)
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2009: Similar tourists to Zanzibar Today
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2019: Price per sq. m. $4800-$5200 (studio)
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2019: About double of Zanzibar today
PROTECT: Proper Maintenance
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Pools
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Gardens
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Room Service
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Electricity & water
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24-hour security
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Maintenance
