Springmaid Beach Resort

Springmaid Beach Resort
JV Equity Acquisition
BUY • IMPROVE • SELL
Asset Overview
Investment at a Glance
Through a joint venture, KBS Strategic Opportunity REIT
II acquired a 90% equity interest in the Springmaid Beach
Resort in Myrtle Beach, SC. Springmaid Beach Resort
opened in 1948 and is situated on 30 acres of oceanfront
land adjacent to the 312-acre Myrtle Beach State Park.
The Springmaid Beach Resort’s primary hotel towers were
built in 1992, 1995 and 2001, with one older three-story
building with 39 rooms built in 1980. The property includes
a 36,000 square foot oceanfront conference center, two food
and beverage outlets, a pier gift shop and tackle shop, indoor
and outdoor pools, a fitness center, a miniature golf course,
an arcade room, one quarter mile of beach frontage and
one of the longest fishing piers in South Carolina. It also
includes a separately-parceled 187-unit RV campground.
Name . . . . . . . . . . . . . . . . . . . Springmaid Beach Resort
Location . . . . . . . . . . . . . . . . . . . . . . . Myrtle Beach, SC
Property Type . . . . . . . . . . . . . . . . . . Resort/Hospitality
Acquisition Date . . . . . . . . . . . . . . . December 30, 2014
Purchase Price . . . . . . . . . . . . . . . . . . . . . . . $40,000,000
Site Size . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Acres
No. Rooms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491
Conference Center Size . . . . . . . . . . . . . . . . . . 36,000 SF
Parking . . . . . . . . . . . . . 793 Car Spaces, 9 Bus Spaces
Included in this Investment:
RV Campground . . . . . . . . . . . . . . . . . . . . 187 Units
Pier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,060 Feet
KBS, together with its joint venture partner, intends to make
significant renovations to the Springmaid Beach Resort.
This is neither an offer to sell nor a solicitation of an offer to buy shares of KBS Strategic Opportunity REIT II; offering is only made by prospectus (www.kbsreits.com). This
information must be preceded or accompanied by a prospectus in order to understand fully all of the implications and risks of the offering. Neither the Attorney General of
the State of New York nor any other state regulators have passed on or endorsed the merits of this offering. Any representation to the contrary is unlawful.
Investing in KBS Strategic Opportunity REIT II includes significant risks. These risks include, but are not limited to: the possibility of losing your entire investment; no
guarantees regarding future performance; upon sale or distribution of assets you may receive less than your initial investment; fluctuation of the value of the assets owned
by KBS Strategic Opportunity REIT II; lack of a public market for shares of KBS Strategic Opportunity REIT II; limited liquidity; limited transferability; reliance on KBS Capital
Advisors, the REIT’s advisor, to select, manage and dispose of assets; payment of significant fees; and various economic factors that may include changes in interest rates,
laws, operating expenses, insurance costs and tenant turnover. Shares of KBS Strategic Opportunity REIT II are not suitable for all investors.
The KBS Strategic Opportunity REIT II offering is not an institutional offering and may have higher fees and expenses than institutional offerings. KBS Strategic Opportunity
REIT II has a limited history of operations. Please see back page for additional risk factors.
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Myrtle Beach, SC
Market at a Glance
KBS Strategic Opportunity REIT II
Myrtle Beach is situated along a more than 60-mile stretch
of beach known as the Grand Strand on the South Carolina
coast and is separated from the continental U.S. by the
Intracoastal Waterway. Myrtle Beach is located 95 miles from
Charleston, S.C., 148 miles from Columbia, S.C. and 174
miles from Charlotte, N.C. Hosting more than 15 million
annual visitors, Myrtle Beach benefits from a year-round
influx of tourism and is a resort market with both healthy
domestic and foreign tourism interest.1 Popular tourist
attractions include the many golf courses, Broadway at the
Beach, The Carolina Opry, Legends in Concert, Family
Kingdom Amusement Park, the Myrtle Beach Boardwalk,
Market Common and Myrtle Beach State Park.
KBS Strategic Opportunity REIT II is primarily focused on
acquiring investments with a total return profile that provide
capital appreciation and current operating income. These
investments consist of opportunistic or value-added real
estate, distressed debt or other real estate-related investments
in the United States and Europe. KBS Strategic Opportunity
REIT II’s objectives are to preserve and return its investors’
capital, realize growth in the value of its investments and
provide increasing cash distributions to its investors through
increased cash flow from operations or targeted asset sales.2
Myrtle Beach enjoys abundant sunshine year-round and
a long beach season from April through October. Myrtle
Beach’s mild winters typically last from December through
February.
Myrtle Beach Chamber of Commerce
1
There is no assurance that KBS Strategic Opportunity REIT II will meet the
stated objectives.
2
KBS Capital Markets Group LLC
660 Newport Center Drive, Suite 1200
Newport Beach, CA 92660
(866) KBS-4CMG (527-4264)
www.kbs-cmg.com
Additional risk factors:
KBS Strategic Opportunity REIT II’s organizational documents do not restrict it from paying distributions from any source and do not restrict that amount of distributions it
may pay from any source, including offering proceeds or borrowings. Distributions paid from sources other than current or accumulated earnings and profits may constitute
a return of capital. A return of capital would reduce the amount KBS Strategic Opportunity REIT II would have for investment which could reduce an investor’s return on
investment and subsequent investors will experience dilution. There are no guarantees that KBS Strategic Opportunity REIT II will pay distributions.
KBS Strategic Opportunity REIT II’s advisor and its affiliates, KBS Strategic Opportunity REIT II’s executive officers, some of its directors and other key professionals face
conflicts of interest, including significant conflicts created by its advisor’s compensation arrangements with the REIT and other KBS-sponsored programs and KBS-affiliated
investors.
KBS Strategic Opportunity REIT II expects to use debt in connection with its investments, which increases the risk of loss associated with these investments and could
hinder its ability to pay distributions to its stockholders or could decrease the value of its stockholders’ investments if income on, or the value of, the property securing the
debt declines.
KBS Strategic Opportunity REIT II may make adjustments to its target portfolio, based on real estate market conditions and investment opportunities. The REIT may change
its targeted investments and investment guidelines at any time without the consent of its stockholders.
KBS Strategic Opportunity REIT II expects to elect to be taxed as a REIT beginning with the taxable year ended December 31, 2014. Should KBS Strategic Opportunity REIT
II not qualify as a REIT, it may be subject to adverse tax consequences. Please refer to the prospectus for more detailed information regarding these consequences.
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©Copyright 2014, KBS Capital Markets Group LLC • Securities distributed by KBS Capital Markets Group LLC • Member FINRA & SIPC.
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