Tranquility Hollow

Timing analysis - 2018

Although, this analysis allowed us to determine potential profits at starting and ending points. Obviously, there are many variables that will determine the timing of how this would unfold. The two most important variables for timing would likely be capital and demand. With both in good supply, the expansion can come relatively quickly. We feel quite comfortable with the demand; although competition, the economy, growth of the metro area, etc.; all must be considered. Capital available will be almost totally depending on the buyer/investor, and will include not only cash available, but also risk aversion, which events are pushed first, marketing, etc.

To show how the spreadsheets can/could be used to determine outcomes based on some macro assumptions, we took the respective “bottom lines” for different scenarios, and assumed different levels of growth and combinations thereof. The following are examples; but are based on our history and experience. Refer to the spreadsheet “timeline 2018 and more” for results. NOTE: We ran these scenarios for seven years to somewhat “match” earlier versions of the pro forma.

TURN KEY:

  • Depending a little on timing of the reopening, these events can be ramped up to 80% of basic in the first year.
  • The 2nd year (with no next level investment) can reach 80% of maxed out.
  • 3rd year would max out.

NEXT LEVEL (This could be started at any time, but assuming starting after TURN KEY is maxed out.

  • Upon completion of the indoor venue, 2 cabins and one zip line; volume will reach 60% of basic the first year. (Remember, this includes the ongoing “turn key” volume.)
  • Cabins, additional zip lines and use of the indoor venue will increase in 2nd year to 100% of basic, or 20% of maxed out.
  • Continue to add cabins in 3rd year to 50% of maxed capacity.
  • 4th year is 70% of maxed capacity.
  • 5th year is 100% of max

NOTE: In this scenario, we ran did not start next level until the 4th year. Once could/would assume the construction took place in the 3rd year.

THE COMBO

So, “What if”; you were able to afford or have at least some of the Next Level investment money right away. You would then begin the “turn key” events the first year, while the barn and perhaps 2-3 cabins were being built. While such things as utilities and roads are part of the “next level” expense, getting this going and done will only enhance further expansion.

This then creates a scenario combining some of the turn key and next level events early, morphing into next level numbers in the 2nd year, etc. To wit:

First year 80% of TURN KEY basic

2nd year; 100% of TURN KEY basic PLUS, 20% OF NEXT LEVEL BASIC. (In this scenario, turn key and next level events will be added together as the overlap will not occur until Next level is up and running the following (3rd) year.

3rd year: 50% of NEXT LEVEL MAXED, which then includes the TURN KEY revenue.

4th year: 80% of NEXT LEVEL MAX

5TH year: 100% of NEXT LEVEL MAX

As one would expect, the sooner the next level investment begins, the faster one grows and accumulates profits and/or ROI. For the “bottom line” example, the cumulative profits after seven years for each scenario is:

Turn Key only$2,511,567

Turn key for 3 years, then next level$3,579,619

Turn key and Next Level immediately$8,706,854

The seven-year trend line is: