Ricki Osterthun presentation 26.11.2009

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www.engelvoelkers.com/resorts

The potential and requirements

of the German speaking markets

http://www.engelvoelkers.com/resorts

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ENGEL&VÖLKERS RESORTS | The German marketReasons for an investment

InvestmentInvestment

Investment / Private UseInvestment / Private Use

Private UsePrivate Use


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ENGEL&VÖLKERS RESORTS | The German marketFavourite destinations for an investment

Europe

• Spain

• Italy

• Portugal

• France

• Greece

• Germany

Worldwide

• USA

• South Africa

• Dubai


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ENGEL&VÖLKERS RESORTS | The German marketPurchase decision criteria for an investment

Macro• Family• Country – Accessibility • Language• Medical Support• Weather • Costs • Interest of Family• Service Concept• Political circumstances• Security• Utilisation


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ENGEL&VÖLKERS RESORTS | The German marketPurchase decision criteria for an investment

Micro• Decision of the family• Additional costs• Size of the property• Fitting• Daily routine• Accessibility - Airport• Accessibility - Infrastructure• Security within the property• Service und Maintenance• Contracts• Furniture


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ENGEL&VÖLKERS RESORTS | The German marketRequirements demanded by German-speaking customers

Real estate:

§ Views, open view, at best water view and landscape

§ Clear floor plan / layout, not too intertwined, rooms not too small

§ Parking space in building, short walk from parking space to apartment

§ Private sphere through sufficiently large balconies and terraces hidden from view

§ Pool

§ Small communal facilities for owners

§ Ceiling height

§ Windows down to the ground

§ Bathrooms with windows


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Quality:

§ Brand manufacturers

§ Technology of the highest level

§ High-quality material

§ High-quality kitchens, bathrooms and fittings

§ High-quality doors and windows

§ Very good finish


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Infrastructure:

§ Excellent infrastructure within the project and to the airport

§ Distance from sea and beach

§ Shopping possibilities for daily requirements

§ Restaurants

§ Leisure time facilities (indoor and outdoor)

§ Distance to the next towns


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Security/Service concept:

§ Comprehensive offer for real estate but also other services

§ Comprehensive Service concept

§ Transfer, catering, laundry (clothing)

§ Preliminary set up for alarm system

§ Intercom system

§ Cameras

§ Caretaker

§ Concierge Concept

§ Comprehensive Spa and Wellness supply

§ Shopping area

§ High quality restaurants

§ Good medical Supply


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ENGEL&VÖLKERS RESORTS | The German marketMarket performance and future development

§ We are in times of a financial crisis and investors are very risk averse

§ The international markets have changed dramatically

§ Supply: Secondary homes – a former supply-driven market

§ Hundreds of developments neglecting architecture, service, maintenance and above all the unique selling prepositions in a highly competitive surrounding were built in the past decade resulting in overcapacities

§ Demand: Different customers with different needs

§ Especially UK as a former strong buyers market suffered

§ The currency parities devalued all assets and banks do not grant more than 70% mortgage loan to value for the buyer.

§ Market transparency: Customers have access to a vast range of information through the internet.

§ Usage intention has changed: A growing majority of customers use the property themselves, looking for uniqueness, high quality and a profitable return on investment.

§ The German speaking markets are stable and strong, increasing demand in tangible assets

§ Large aim group with strong purchasing power and adequate capital assets in the German speaking markets

§ In 2008, E&V had a total transaction volume in real estate of approx. 5 billion EUR and a brand commission turnover of 146.5 million EUR

§ Until 06/2009 E&V Residential Germany had a turnover performance of plus 15% compared to 2008


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ENGEL&VÖLKERS RESORTS | The German marketSuccessful marketing and customer communication

The German customer highly quality sensitive, with strong safety needs and high expectations towards all

contractors.

• Travel arrangements for customer

• Site visit program

• Highly qualified sales personal

Customer approach and lead generation

Information and customer contact Site visits Sales and after sales

services

Customer communication and service process Customer moves in

• Ad campaigns

• Online/ Internet

• Direct marketing

• Events

• Brochures

• Facts & Figures

• Exposés

• Building descriptions

• Contract management

• Financing consultancy

• Consultancy and support concerning construction and furnishing


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Customer approach and lead generation – marketing tools in the German

speaking markets

Advertisements are the most effective measurements to target the market -Requirements:

§ Large formats (i.e. Double DIN A4/ ½ page)§ In representative media

§ i.e. Welt/ Welt am Sonntag Style: Daily national newspaper/ WamS every SundayCirculation: Welt: 280.387 / WamS: 402.069 (Reach Combination

1,2 Mio.)§ i.e. FAZ/ FAS

Style: Daily national newspaper/ FAS every SundayCirculation: 362.396/ FAS 336.513 (Reach: FAZ/ FAS: 1.6 mio.

readers in Germany/ worldwide)

§ High quality lifestyle images

Product quality, reliability and positioningStrong tool for lead generation


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Toscana Resort Castelfalfi

Double page,

Welt/ WamS, June 16th 2009


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Customer approach and lead generation – marketing tools in the

German speaking markets

Online measurements

§ Internet presentation (homepages)§ Internet exposés

Results:

§ Media usage in Germany is still very print focused§ Online marketing is important and a growing instrument

For the main target groups online marketing is not effective and efficient.

Source: Media Focus Werbedruckstatistik, 06/2008


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Customer approach and lead generation – information and sales material for the German speaking markets

High quality brochures – Content:§ Region and location, surrounding/views§ Amenities, service, maintenance and security § Specifications, layouts and master plan § Information about the developer

Facts & Figures, Building description

§ Detailed information about the project§ Detailed information about the architecture§ Detailed information about tax and legal requirements§ Product characteristics in detail

Exposés – Individual Offers according to the customers needs


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The German customer has high expectations concerning a site visit of the project.

Tasks/ requirements in the customer service process:

§ Travel arrangements for customer

§ Highly qualified sales personal

§ Site visit program

§ The host takes full care of the customer from the arrival to the departure.

§ The journey will be planned for the customer; he will be given an itinerary incl. sightseeing. (recommendation 2 days).

§ The customer will be welcomed at the airport and taken to the hotel (incl. welcome package).

§ A detailed discussion will take place with a subsequent viewing of the showrooms. Special apartments will be selected before the inspection, depending on the wishes and requirements of the customer.

§ The host will be at the customer’s disposal for questions and wishes for the entire stay.


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ENGEL&VÖLKERS RESORTS | The German marketSales Service

German customers need comprehensive services and consultancy during the purchase process.

• Support and advisory services before, during and after purchase

• Personalised offer and preparation of relevant data and documents

• Contract management

• Financing consultancy

• Placement of tax and legal consultancy

• Consultancy and support concerning construction and furnishing

Example:

• E&V Resorts as a developer in Portugal in cooperation with Portuguese constructors to ensure high quality standards, fast communication, transparency and local coordination


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6. Vorgehensweise einer Zusammenarbeit


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ENGEL&VÖLKERS RESORTS | The German marketConclusions

Conclusions concerning German customer behavior:

Media usage:

§ German customers still rely on classic print media

§ Greatest effects are measured, if the advertisements are in high quality, very representative and support the products‘positioning

Material:

§ German customers require highly detailed information material to satisfy their safety needs

§ High profile documents alleviate the sales process and ensure transparency for the customer

§ Time intense, individualized offers and exposés are expected by the German customers

Service:

§ The German customer requires various services, security, and transparency during the communication and sales process

§ The German customer needs to be addressed with great sensitivity, with great time effort to create trust as a basis for selling

§ A full service concept has to be offered including highly trained sales staff, consultancy and 100% customer orientation


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ENGEL&VÖLKERS RESORTS | The German marketConclusions

Conclusions concerning the German speaking markets:

§ There is a stable and growing market potential due to the strong customer base in the German speaking region

§ The German customer is rather risk averse and has great safety needs

§ The German customer requires various services, security, and transparency during the marketing, communication and sales process

§ The German customer needs to be addressed with great sensitivity, with great time effort to create trust as a basis for selling

§ A full service concept has to be offered including highly trained sales staff, consultancy and 100% customer orientation


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Thank you for your attention!


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ENGEL&VÖLKERS RESORTS | The German marketExecutive Summary E&V Resorts

Who is Engel & Völkers?

§ Established in 1977 § 3.340 employees/agents worldwide§ 382 residential real estate shops/ offices and 540 residential licences worldwide§ 36 commercial offices and 32 commercial licences

Who is E&V Resorts?§ Since 2004 - E&V Resorts is a full subsidiary of the E&V group§ Specialized in the tailor-made marketing, sales and strategic consultancy services for luxury resorts§ Target market: German speaking countries (Germany, Austria, Switzerland) and Europe§ Team: Efficient and customer-orientated with experienced in-house architects and marketing and sales experts

What is our service portfolio? § Consultancy services for every stage in the development process: Feasibility studies, SWOT analysis, master

planning, master concepts and more§ Tailor-made marketing and sales for your resort using the strong E&V brand and the extensive network

How do you benefit from a cooperation with E&V?§ Market entry opportunity: Target the high potential German speaking market with a professional cooperation

partner! § Image transfer and market access: Be part of the E&V success and profit from the network!§ Individual strategies: Benefit from the years of experience!


Real Estate

Ricki Osterthun presentation 26.11.2009