BUILDING WEALTH “ANYBODY CAN BUY A BUILDING. EVERYBODY IS AN EXPERT IN PROPERTIES. BUT IT TAKES A CERTAIN KIND OF SOMEBODY TO BUILD WEALTH WITH REAL ESTATE ASSETS.” KLAUS W. BENDER ACRON HELVETIA XII IMMOBILIEN AG CITY HOTEL OBERLAND INTERLAKEN INVESTMENT IN AN ESTABLISHED HOTEL IN THE TOURISM HOT SPOT PUBLICATION MARCH 2018 TOP OF EUROPE TOP LOCATION THE BEST AMONG THE TOP INVESTMENT OPPORTUNITIES CONTENTS THE INVESTMENT AT A GLANCE 5 INVESTMENT CONCEPT — THE OFFER 6 INVESTMENT HIGHLIGHTS 8 FINANCING AND INVESTMENT PLAN 9 HOTEL’S OPERATION ACCOUNTINGS 12 THE FORECAST 13 ORGANIZATIONAL STRUCTURE 18 SWITZERLAND AS AN INVESTMENT LOCATION: TOP GLOBAL RANKING 20 SWISS HOTEL MARKET: ON A GROWTH TRAJECTORY IN A GLOBALLY EXPANDING SECTOR 22 THE PROPERTY: FROM 3-STAR STANDARD HOTEL TO A MODERN MULTIFUNCTIONAL ASSET 26 INTERLAKEN AS A VACATION, ADVENTURE AND CONFERENCE REGION 44 YOUR PARTNERS 48 RISK FACTORS 54 Against the backdrop of ACRON AG’s solid track record of success in Switzerland and long-standing experience and knowledge of the Swiss market, ACRON presents a core plus investment in an excellent location: the heart of Interlaken, a hot spot for tourism in the Swiss Alps. By carrying out focused construction projects, we aim to further improve the variety of amenities and quality of the three-star City Hotel Oberland property over the next three-and-a-half years, thereby setting the stage for also increasing future cash flows and achieving value growth for investors. ACRON offers qualified investors in Switzerland the opportunity to participate in a real estate investment in a Swiss hotel property: THE PROPERTY – CITY HOTEL OBERLAND, INTERLAKEN, SWITZERLAND 192-room hotel with restaurants, a bar, retail space, and staff housing Three-star lodgings for the following target groups: ■ Individual travelers ■ Seminar and meeting attendees ■ Adventure tourists ■ Groups Modernization: beginning in off-season 2018 ACRON HELVETIA XII IMMOBILIEN AG ■ Annual cash-on-cash return (ratio of average cash distributions to the total amount of cash invested) of 8.25% (forecast) and ■ annual IRR (internal rate of return) of 15.5% (forecast) based on ■ a planned medium-term investment horizon of only four years. 4 | AHXII Investing Together – THE INVESTMENT Your Interests Are Our Interests AT A GLANCE Maximizing distributions and returns is our top priority – This is the goal ACRON has in mind when structuring an investment ACRON HELVETIA XII Immobilien AG (AHXII) model with a preferred return for investors. holds the City Hotel Oberland in Interlaken ACRON will not receive a share of the through the intermediary City Hotel investment return until a specified annual Oberland AG. ACRON HELVETIA XII distribution yield of at least 6% and a total Immobilien AG has acquired all of the shares of annual investment return (IRR) of at least 12% has been realized for investors. This City Hotel Oberland AG. ensures that the interests of investors and ACRON are aligned. This incentivization The capital structure for the acquisition will of ACRON also avoids a concentration be as follows: on ongoing asset management fees and ■ Equity from ACRON AG and co-investors in encourages ACRON to exit the investment the amount of CHF 22,600,000 as early as possible and at an optimal time for investors. ■ Financing in the amount of CHF 21,000,000 from Raiffeisen Bank (Switzerland) ■ Financing in the amount of CHF 4,000,000 After all liabilities owed have been paid and from Schweizerische Gesellschaft für the appropriate reserves set up as determined Hotelkredit (SGH) by the AHXII Board of Directors, AHXII will distribute any remaining cash (“available cash The CHF 25,000,000 in borrowed capital will flow”) once a year as follows:: be used firstly to refinance the City Hotel Oberland AG liability and secondly to finance ■ The operating cash flow will first be the planned renovations. distributed to the holders of preference shares until an annual return of six percent AHXII investors are invited to participate (6%) on their total initial capital contribution in the company’s capital increase by up is reached (“preferred return”). This preferred to CHF 22.5 million by way of the issue of return is not cumulative. 45,000 preference shares at an issue price ■ If there is any available cash flow remaining, of CHF 500.00 each. seventy-five percent (75%) will be distributed to all holders of preference shares and The use of the funds will be strictly in twenty-five percent (25%) will be distributed accordance with the “Financing and Investment to ACRON AG, the founding shareholder and Plan” section in this brochure. The funds will be holder of the AHXII ordinary shares. used exclusively to acquire equity investments ■ The cash available upon exit (sale or in the property company described in this refinancing of the property or AHXII) will document, to repay short-term liabilities and initially be distributed to the holders of loans from banks, and to pay fees and other preference shares until an annual return costs associated with this investment in the (IRR) totaling twelve percent (12%) has been appropriate amounts. reached. ■ If there is any available cash flow remaining ACRON AG acts as the initiator of this subsequently, sixty-five percent (65%) will transaction, and as service provider and be distributed to all holders of preference property manager and will make available its shares and thirty-five percent (35%) will be professional expertise and wealth of experience paid to the sponsor, ACRON AG. to AHXII investors. THE INVESTMENT AT A GLANCE | AHXII | 5 INVESTMENT CONCEPT — THE OFFER investors who ACRON HELVETIA XII IMMOBILIEN AG want to invest their FOR ... investors who available liquidity in would like to benefit Swiss francs for the from tax-advantaged medium term and prefer distributions. a tangible asset. investors who would like to invest investors who in Switzerland, a top want to benefit from global investment the opportunities of location. investing in a foreign currency, specifically Swiss francs. investors who already hold investments in US dollars investors who and euros and would INVEST IN would like to invest like to further diversify ACRON HELVETIA XII IMMOBILIEN AG in an international their portfolio with an SWITZERLAND growth sector. investment in Swiss INTERLAKEN francs. CITY HOTEL OBERLAND EuroAirport Basel Mulhouse Freiburg Zurich Airport Business Airport St. Gallen-Altenrhein Basel Zurich St. Gallen Lucerne Bern Bern Airport Chur Lake Thun Lake Brienz Interlaken St. Moritz Lausanne Montreux Aéroport International de Genève Genf Lugano Zermatt Lugano Airport 6 | AHXII | INVESTMENT CONCEPT — THE OFFER ACRON HELVETIA XII IMMOBILIEN AG Investment volume CHF 47,600,000 Equity CHF 22,600,000 Total revenues hotel and retail CHF 11,500,000 (2020) Registered office c/o Buchhaltungs- und Revisions - AG Bundesstrasse 3, 6302 Zug Legal form stock corporation Registered on September 26, 2017 Company number/UID CHE-301.519.542 Valor CH039904504 ISIN CH0399045043 Share capital (ordinary shares) CHF 100,000.00 (100,000 registered shares with a nominal value of CHF 1.00) Share capital (preferred shares) CHF 45,000.00 (45,000 registered shares with a nominal value of CHF 1.00) Subscription (issue price) CHF 500 per share Number of voting rights per share 1 President of the Board of Directors Kai Bender Member of the Board of Directors Peer Bender ACRON HELVETIA XII IMMOBILIEN AG | 7 INVESTMENT HIGHLIGHTS annual 15.5% return (IRR)* ACRON HELVETIA XII Immobilien AG carries on ACRON’s proven investment concept in the Swiss real estate market, offering investors a secure, transparent, and profitable real estate investment: ∅ cash-on-cash- 8.25% distribution* ■ Property already acquired ■ Full alignment of the interests of the initiator, hotel operator, and investors ■ Preferred distributions for investors ■ Investment by ACRON with secondary investment horizon 4 years entitlement to distributions maximally* ■ Right to preferred return on equity investments ■ Tax optimization: partial repayment of equity through payouts from the capital contribution reserve, so no withholding tax attractive exit ■ Acquisition of the property well under options market value ■ Current property appraisal by prominent *forecast Swiss real estate appraisers completed ■ Property with enormous appreciation potential ■ Security: risk minimization and independence thanks to mix of uses and guests ■ Financing commitment for renovation already obtained ■ Ten-year management contract (plus options) signed with experienced local hotel operator ■ Ten-year lease with retail anchor tenant Investment volume Bongénie Grieder CHF 46,700,000 ■ Experienced investment initiator with Real estate acquisition a highly effective local expert network CHF 32,600,000 ■ Cash flow forecast by ACRON based on Refurbishment costs conservative assumptions CHF 10,500,000 ■ Maximum transparency: ACRON standards Market value at actual state (annual reports, NAV reporting, General CHF 45,370,000 (E&Y) Meeting of Shareholders, Intralinks, etc.) Market value after refurbishment CHF 60,140,000 (E&Y) (132.5%) Appraisal of Ernst and Young as of September 30, 2017 8 | AXII | INVESTMENT HIGHLIGHTS FINANCING AND INVESTMENT PLAN SOURCE OF FUNDS Per Key (rounded) CHF Equity 117,098 22,600,000 Senior Debt 129,534 25,000,000 TOTAL SOURCE OF FUNDS 246,632 47,600,000 USE OF FUNDS Real estate acquisition 168,912 32,600,000 Working capital reserve 1,036 200,000 Financing costs 3,109 600,000 Due diligence costs 2,902 560,000 Refurbishment