ARIE
LAGOON

Premium Hotel Investment

Negombo, Sri Lanka

Arie Lagoon Hotel - Pool and Lagoon View

Investment Advisory

Rehan Grero
November 2025

Executive Summary

Exceptional value opportunity with negotiated pricing

$9.0M
Asking Price
Original seller expectation
$7.0M
Negotiated Price
22% discount achieved
55
Room Keys
Well-appointed accommodations
5 Acres
Land Area
Largest in Negombo
Arie Lagoon Hotel - Infinity Pool and Lagoon View
02

Investment Metrics

Financial performance at negotiated price point

Metric At $7M Negotiated Market Benchmark Advantage
Price per Room $127,273 $180,000 - $200,000 29-36% below
Revenue Multiple 3.9x - 5.8x 6x - 8x 35% discount
Cap Rate 10.3% - 15.4% 7% - 9% Premium yield
Total Discount $2,000,000 From asking price 22% saved

5-Year NOI Projection

$450K Year 1
$578K Year 2
$726K Year 3
$898K Year 4
$1.1M Year 5
$1.5M
Annual Revenue

Revenue Breakdown

Room Revenue
$900,00060%
Food & Beverage
$375,00025%
Other Services
$225,00015%
03

Strategic Advantages

Unique positioning in Negombo market

Arie Lagoon Hotel Property
Waterfront Paradise
300ft of pristine lagoon frontage with infinity pool overlooking the water. This 5-acre estate offers unparalleled views and expansion opportunities.
LOCATION
Prime Location
Gateway position 10km from international airport. Dual waterfront with 300ft lagoon frontage and beach proximity. Primary tourist corridor location.
EXPANSION
Development Potential
5 acres - largest hotel land in Negombo. Capacity for 20-30 additional rooms. Event venue and F&B expansion opportunities.
REVENUE
Immediate Cash Flow
$1.2M - $1.8M annual revenue currently. Established operations with proven demand. Multiple revenue enhancement opportunities.
GROWTH
Value Creation Path
Revenue management implementation (+15% ADR). Operational efficiency improvements (5% margin). Market repositioning opportunity.
04

Return Profile

Conservative to optimistic scenario analysis

Conservative
12%
IRR over 5 years
1.4x equity multiple
Base Case
23%
IRR over 5 years
2.3x equity multiple
Optimistic
32%
IRR over 5 years
2.8x equity multiple
Deal Structure Amount Terms
Purchase Price (Negotiated) $7,000,000 22% below asking
Equity Investment (40%) $2,800,000 Limited partners
Senior Debt (60%) $4,200,000 8-10% interest, 7-year term
Year 5 Exit Value $11,000,000 10x NOI multiple
05

Investment Decision

Time-sensitive opportunity requiring immediate action

Proceed with Acquisition

$7M negotiated price represents exceptional value
22% discount already secured from $9M asking
35-40% below market comparables
Clear path to 23-28% IRR

Execute Purchase Agreement
06
Confidential | November 2025