TH Developments

The Auruum is more than a luxury development; it’s a vision brought to life in the heart of Cape Town, merging opulence, convenience, and sustainability in one prestigious address. This unique blend of high-end living and environmentally responsible development redefines luxury, offering a sanctuary for executives, business travelers, diplomats, and affluent residents who prioritize privacy, elegance, and accessibility.

Land Secured:

Prime Location: Land has been secured at St Johns Road, strategically located just 90 meters from Parliament, providing an unbeatable site for this high-end development.

Initial Investments and Partnerships:

Committed Team: An experienced core team led by John Freeman (CEO), Marcell (CFO), and Daniel (COO) has laid the foundation for a successful project, attracting interest from architects, engineers, and top contractors.
Partnership Development: Discussions with various industry stakeholders to secure architectural and construction partnerships are underway.

Project Preparation:

Feasibility Study: A comprehensive feasibility study has been conducted, validating the project’s potential and anticipated demand in the Cape Town luxury market.

Planning and Zoning Approvals: Building plans have been submitted to the council, with necessary steps taken to ensure the project meets zoning requirements for mixed-use and high-density residential development.

Demand Analysis: Market research and early interest from high-net-worth individuals and potential buyers confirm strong demand for luxury aparthotel-style living in Cape Town’s central district.

With key groundwork already laid, The Auruum is now poised for the next stage: securing investment partners to bring this vision to life.

The Auruum is designed to attract high-net-worth individuals (HNWIs), business travelers, diplomats, and affluent international buyers seeking luxury living in Cape Town's prime locations. These clients prioritize exclusivity, security, and proximity to business and governmental hubs. The target age group ranges from 35 to 65 years, encompassing established professionals, executives, and retirees who value premium amenities and a sophisticated urban lifestyle.

Market Size and Demographics:

As of 2024, Cape Town is home to approximately 7,400 millionaires, 28 centi-millionaires, and one billionaire.

The city's luxury property market has shown resilience, with prime residential prices climbing by 12.3% in 2023, ranking Cape Town among the top five cities globally for luxury property price growth.


Global and Local Market Trends:

Globally, the luxury real estate market has demonstrated robust growth, with prime residential prices increasing by an average of 3.1% in 2023.

Cape Town's luxury property market has outperformed this global average, reflecting strong demand and investment potential. The city's appeal to both local and international buyers, coupled with its status as a premier lifestyle destination, has contributed to this upward trend.

Future Market Potential:

Projections indicate that Cape Town's millionaire population will grow by 85% over the next decade, reaching over 13,500 by 2033.

This anticipated increase in affluent residents suggests a corresponding rise in demand for luxury accommodations. The Auruum is well-positioned to meet this demand, offering premium living spaces that cater to the discerning tastes of this expanding market segment.

In summary, Cape Town's luxury real estate market is experiencing significant growth, driven by an increasing number of high-net-worth individuals and sustained demand for premium properties. The Auruum's strategic location and upscale offerings align with the preferences of this affluent clientele, positioning it favourably within this thriving market.

The Problem:
Cape Town’s luxury property market lacks developments that cater specifically to the unique needs of high-net-worth individuals, diplomats, and business travelers. With limited options that combine premium amenities, secure urban living, and convenient access to business and government hubs, the city’s core has an untapped demand for upscale, multi-functional accommodation. Additionally, existing luxury properties often miss the mark in delivering a blend of sustainable luxury and high operational standards that appeal to today’s discerning buyers and tenants.

The Opportunity:
The Auruum is set to fill this gap by creating an exclusive aparthotel-style development at one of Cape Town’s most coveted addresses. Located just steps from Parliament, The Auruum offers the ideal blend of prestige, convenience, and privacy, attracting local and international elites who prioritize location, quality, and exclusivity.

By capitalizing on these trends, The Auruum not only addresses an underserved market but also provides investors with a high-yield, low-risk opportunity to be part of an iconic, sustainable development in one of Africa’s most desirable cities.

Cape Town’s affluent residents, business travelers, and diplomats face a shortage of premium accommodations that balance luxury with prime location. The city’s central areas lack developments that cater to high-net-worth individuals who seek convenient access to business hubs, governmental offices, and cultural landmarks without compromising on exclusivity and privacy. Additionally, existing accommodations often fail to provide the flexibility needed for both short and long-term stays, which can inconvenience business travelers and diplomats requiring adaptable lodging arrangements.

High-profile clients prioritize safety, security, and privacy in their accommodations, but many properties do not offer robust security solutions designed for their specific needs. Furthermore, modern clients expect seamless integration of technology to elevate their living experience, but most available options lack the smart home features that today’s discerning residents expect. This limits the personalization and control clients have over their environment, affecting their overall satisfaction.

Lastly, the demand for sustainable living continues to grow, especially among luxury clients who are increasingly mindful of their environmental footprint. Many upscale properties in Cape Town, however, still lag behind in integrating sustainable practices and eco-friendly systems, leaving environmentally conscious clients with limited options that align with their values and lifestyle expectations.

Cape Town's luxury real estate market is vibrant, featuring several high-end developments that cater to affluent buyers and investors. Notable competitors include:

1. The Flamingo, Sea Point

Developer: Signatura
Features: Offers 71 studio and one-bedroom apartments ranging from 27 to 47 square meters, each with a private balcony. Design inspired by Miami's South Beach, featuring SMEG appliances and air conditioning in every unit.

2. The Sage, Sea Point

Developer: Rawson Developers
Features: Comprises 91 ultra-luxury apartments priced between R1.49 million and R5.55 million. Amenities include a ground-floor lobby, 24-hour concierge, co-working business lounge, and optional parking.

3. The Valour, De Waterkant

Developer: Quorum Holdings
Features: A boutique development offering studios to panoramic penthouse apartments priced from R1.55 million to R6.6 million. Located in the vibrant De Waterkant neighborhood, emphasizing architectural design and luxury living.

4. Riverlands, Observatory

Developer: Signatura
Features: A mixed-use precinct featuring luxury apartments starting from R1.675 million. Amenities include a leisure deck with a swimming pool, gym, 24-hour reception, and proximity to a new shopping center.

5. The York, Cape Town CBD

Developer: Not specified
Features: Situated at 1 Buiten Street, offering units priced from R1.46 million to R2.71 million. Emphasizes timeless elegance, cutting-edge technology, and uncompromised value in the heart of Cape Town.

These developments highlight the competitive landscape of Cape Town's luxury property market, each offering unique features and amenities to attract discerning buyers and investors.

The Auruum offers a unique value proposition through its unparalleled central location, adaptable aparthotel model, specialized security for high-profile residents, and an emphasis on sustainable luxury. These elements combine to create an exclusive living experience that competitors may find challenging to replicate fully.

Financial Projections Over 5 Years in USD. (Unit Sales Only in Year 1)
Year| Total Revenue | Operating Expenses | Profit
1 $7,423,306 $4,453,984 $2,969,322
2 $3,887,859 $2,332,715 $1,555,144
3 $4,276,645 $2,565,987 $1,710,658
4 $4,704,309 $2,822,585 $1,881,724
5 $5,174,740 $3,104,843 $2,069,897

Notes:
Year 1 Revenue: Includes both one-time unit sales ($3,888,889) and rental income ($3,534,417).
Years 2–5 Revenue: Reflects only rental income, which increases by 10% annually.
Operating Expenses: Calculated as 60% of the total revenue for each year.

Revenue Streams:

Unit Sales: One-time sale of 30% of units in the first year, generating upfront capital.
Rental Income: 70% of units rented out, balancing short-term and long-term stays, with an estimated 70% occupancy rate.

Pricing Strategy:

Luxury Pricing: Units sold at premium rates (FROM $100K each) targeting high-net-worth buyers.
Daily Rentals: Short-stay rate of $170 (R3,000) per night to attract business travelers, diplomats, and tourists.

Cost Management:

Operational Efficiency: High-quality service and maintenance to ensure guest satisfaction, with expenses estimated at 60% of revenue.
Asset Utilization: The land itself serves as collateral, reducing financial risk.

Long-term Growth:

Revenue Scaling: Projected 10% growth in rental revenue annually.
Sustainable Profitability: Focus on high occupancy rates, luxurious amenities, and premier location to ensure consistent demand.

The secured $5 million investment will be strategically allocated to ensure smooth progress and timely completion of The Auruum development. Funds will be used as follows:

Land Acquisition and Collateralization:

Purpose: Finalize the land purchase and use it as collateral to secure favorable financing terms.

Allocation: A significant portion of the funding will be directed toward securing the prime St Johns Road property, ensuring the foundation for the development.
Feasibility Studies and Preliminary Designs:

Purpose: Conduct in-depth feasibility assessments and finalize architectural and engineering plans.

Allocation: Part of the funds will be dedicated to hiring industry-leading consultants to refine building plans, assess market feasibility, and ensure regulatory compliance.
Regulatory Approvals and Permits:

Purpose: Obtain necessary permits and council approvals required to begin construction.

Allocation: Funds will cover legal and administrative costs associated with securing zoning approvals, environmental assessments, and other permits.
Initial Development Costs:

Purpose: Cover early-stage construction expenses, including site preparation, initial infrastructure, and procurement of essential materials.

Allocation: The remaining funds will be allocated to cover start-up construction costs to keep the project on schedule for the planned February 2025 launch.

At this stage, we are open to discussing equity terms with potential investors and structuring a mutually beneficial agreement. Our priority is to attract partners who not only see the financial potential but are also aligned with The Auruum's vision for sustainable, luxury real estate in Cape Town.

While the specific percentage of equity we’re offering will depend on the amount invested and the investor’s involvement, we are prepared to negotiate a fair share that reflects the value each party brings to the project.

In a meeting, we would present a range based on industry norms for early-stage development projects, outlining possible equity structures to gauge the investor's expectations. Ultimately, we aim for a partnership that allows The Auruum to grow while offering substantial returns and impact to our investors.

The Auruum’s success depends on stable market demand, competitive differentiation, and the ability to adapt to evolving trends. Economic fluctuations or a financial crisis could reduce luxury property demand, while fierce competition from established developers may challenge The Auruum’s unique offerings. Rising construction costs and potential supply chain issues could delay the project and impact profitability. Technological advancements in smart home and eco-friendly features also pose a risk if competitors adopt newer technologies more swiftly.

Additionally, regulatory changes, especially around zoning or environmental standards, may delay or increase project costs. Lastly, shifts in consumer preferences—such as a reduced demand for luxury short-stay accommodations—could affect occupancy rates. Addressing these risks requires proactive market analysis, adaptability, and strategic planning to ensure The Auruum remains resilient and competitive.

As a real estate development project, participation in an incubation or acceleration program is not applicable for The Auruum. Our project is already fully conceptualized and structured, with groundwork and key partnerships in place. We are on track to commence development in February 2025, and our focus is now on securing investment partners to bring this vision to life. Given the clear project timeline and defined financial and operational strategies, The Auruum is positioned to move directly into the development phase without the need for additional incubation or acceleration support.

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