National Trust Fund for Tourism Development

2

Table of Contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

3

Economics in Mexico

Gross Domestic ProductThousands of Million pesos at constant prices

Unemployment RatePercentage

Total ExportsMillions of Dollars

8,000

8,500

9,000

9,500

2006 2007 2008 2009 20102

3

4

5

6

7

2006 2007 2008 2009 2010 2011

10,000

15,000

20,000

25,000

30,000

2006 2007 2008 2009 2010 2011

Fuente: Inegi, Banxico

Inflation RatePercentage

2

3

4

5

6

7

2006 2007 2008 2009 2010 2011

4

Exchange Rate (MXN /USD)

Direct Foreign Investment in Hotels and Restaurants (million dollars)

Tourism Economy in Mexico

15958

-248

1,234

760715667

438403389

2010200920082007200620052004200320022001

11

10

14

02008 201020092007200620052004200320022001

2

4

6

8

12

1411 1111

1311 11

109

2005 2006 2007 2008 2009 2010

Incomes 11,803 12,177 12,852 13,289 11,275 11,872

Outcomes 7,600 8,108 8,375 8,526 7,132 7,283

Balance 4,203 4,068 4,477 4,763 4,144 4,588

Tourism Trade Balance (Million Dollars)

• The tourism participation in the Gross Domestic Product is ~9%

• 80% of the tourism activities is hold by the national market

• Current population is about 112.3 million people

• National tourism flows: 56.4 million passengers

Source: Banxico, Ministry of Economics, SIIMT

5

Tourism Investment in Mexico

• It is one of the world’s most stable, open and deregulated developing economies, providing foreign investors all the necessary legal facilities and guarantees.

• Mexico is one of the most important tourist destinations in the world.

• It offers a wide variety of opportunities for private investment through FONATUR.

• Tourism is a national priority with the objective of positioning Mexico among the 5 most visited countries as of 2018.

• The total tourism investment in Mexico was ~$2.6 billion dollars.

• In the last six years the infrastructure investment was about 574.9 million dollars.

Source: SECTUR Private investment identified in the tourist sector, Dec. 2009

1 France 67.8 Europe2 USA 52.5 North America3 Spain 51.7 Europe4 China 50.0 Asia5 Italy 41.6 Europe6 UK 27.5 Europe7 Turkey 25.2 Europe8 Germany 23.7 Europe9 Malaysia 23.4 Asia10 Mexico 21.5 North America11 Ukraine 20.3 Europe

Ranking CountryTouristarrivals Region

Ranking by currency income

Position Country Billion Dollars

1 USA 93.9

2 Spain 53.2

3 France 49.4

4 Italy 40.2

5 China 39.7

23 Mexico 11.3

… … …

6

• Temporary taxes exemption and state fees

• Construction license payment exemption

• Taxes and state fees reductions

• Reductions in the rights generated from the Property Public Register

• Reduction of real estate acquisition tax

• Reduction in the payment of licensing fees for construction

• Payroll tax cuts to companies that create new jobs

Note: fiscal and legal incentives may vary by state

Tax incentives in Mexico

7

What is FONATUR?

The National Fund for Tourism Development (FONATUR for its initials in Spanish)

1. To be the institution responsible for the planning and development of sustainable tourist projects of national impact.

2. To be the organism that promotes investment in the country’s tourist sector.

Mission

• Is part of the semi-private public sector

• Is under the sector coordination of the Ministry of Tourism

• Adapts its actions to the National Development Plan and the National Tourism Program

8

• FONATUR pioneered the planned tourism in Mexico creating Cancun (1974), Ixtapa (1974), Los Cabos (1976), Loreto (1976) and Huatulco (1984).

• Cancun started the concept of IPD with the objective of developing tourism in an ordered manner, ecologically friendly and respecting the local urban development.

• These efforts helped attract international tourism placing Mexico among the top tourist destinations in the world, six folding the number of international tourists that visit Mexico and generating well paid jobs.

What is FONATUR?

FONATUR established a new paradigm:Long-term planning as a reliable way to guide decision-making

9

FONATUR’s advantages

Investment Advantages Added Value Observed in FONATUR’s IPDs

• FONATUR’s IPDs are developed through sustainable master plans

• FONATUR provides maintenance to the IPDs, thus guaranteeing their status

• Buying from a government agency gives legal certainty to the investors

• FONATUR provides all services to the lot

• FONATUR prices are competitive and also have financing schemes 0

50

100

150

200

250

300

350

400

Loreto

HuatulcoIxtapa

Los Cabos

Cancún

201020001990IPD Begining

Average price by m2

USD/ m2

1 IPD Begining: Cancún 1974; Los Cabos 1976; Ixtapa 1978; Loreto 1980; Huatulco 19842 CGAR: Compound Growth Annual Rate

CGAR 2

11%

10%

3%

9%

5%

10

FONATUR’s Achievements

1 Dollar

FONATUR’s investment

Promotion of private investment

Private investment (dollars) for each dollar invested by FONATUR

6

9

9Ixtapa

Los Cabos 14

Cancun 19

Loreto

Huatulco

Observedresults

Beach hotels located in FONATUR’s IPDs

Foreign tourists that visit FONATUR’s IPDs

Hotel capacity installed in IPDs

Tourism Revenue generated in IPDs

40%

20%

20%

44%FONATUR has invested 2.7 billon dollars

11

Integrally Planned Developments (IPD)

12

Table of Contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

Marina Cozumel

14

Location

• Marina Cozumel‐ Located in Cozumel Island, Quintana Roo, 40 Km

east from Playa del Carmen (40 minutes).• Accessibility‐ Cozumel International Airport∙ Distance: 8 Km∙ Travel time: 10 minutes‐ Cancun International Airport∙ Distance: 5 Km to Playa del Carmen∙ Travel time: 30 minutes‐ Ferry (Playa del Carmen – Cozumel)∙ Distance: 19 Km∙ Travel time: 40 minutes‐ Puerta Maya (Cruise ship pier)∙ Distance: 100 meters∙ Travel time: 5 min• Regional attractions‐ Natural:∙ Mildly warm climate∙ Reef, forest, mangrove zone∙ Exotic flora and fauna‐ Cultural:∙ Archeological zone∙ Traditional architecture∙ Traditional festivals

15

Statistics

14861735

250000

200000

150000

100000

50000

0

3000

2500

2000

1500

1000

500

0

201020092008

2586

2007

2460

2006

1537

4862846973489414669441172 6000

5000

4000

3000

2000

1000

0

50000

40000

30000

20000

10000

0

2009 20102006 2007 2008

Flights

PassengersCozumel Airport Cancun Airport

Source: Sistema Integral de Información de Mercados Turísticos

Pass

enge

rs

Flig

hts

Pass

enge

rs

(in th

ousa

nds)

Flig

hts

2134 15872165

2344 22852022

+32%

2010

4041

1756

2009

4097

1753

2008

3266

1100

2007

3004

982

2006

2432

845

2005

3072

938

Foreign

NationalCozumel tourist arrivals (in thousand)

266 266 320627

394 388

2010

526

+37%

233

2006

447

181

2005

384

119 138

2009

572

178

2008

924

297

2007

55374%

26%

56%

44%

Cancun tourist arrivals (in thousand)

Registered Rooms in Cozumel Registered Rooms in Cancun

4,5404,5404,5434,5824,4954,321

20102007 20092008

+5%

20062005

30,13129,72529,53828,07826,82627,654

2005 2010

+9%

2008 20092006 2007

16

Project Characteristics

‐ 1.13 Km waterfront

‐ 180º panoramic ocean views

‐ Total surface: 108.10 Acres

‐ Saleable surface: 64.33 Acres

‐ Maximum capacity: 1622 units

∙ Hotel: 572 units

∙ Residential: 1,050 units

‐ Marina: 333 positions (on construction)

17

Marina Cozumel

18

Infrastructure:‐Commercial zone‐Dynamic waterfront‐Residential cluster

Tourist attractions

Nautical services:‐Tourist marina‐Yacht club‐Dry marina‐Gas station

Recreational activities:‐Beach club‐Clubhouse∙Restaurants∙Sport courts‐Theme park (Cenote “El aerolito”)

19

Master Plan Marina Cozumel

42%

11%

9%

1%24%

13%

Other*

Tourism facility

Single family

Residential

Commercial

Hotel

Land use distributionPercentage with respect to total m2

* Urban equipment, green areas, etc.

Urban plan

Marina Cozumel

Available Lots‐ Commercial: 1‐ Residential: 9‐ Single Family: 55‐ Tourism facility : 1

Coming Soon:‐ Hotel: 4‐ Commercial: 2‐ Residential: 3‐ Tourism facility: 1

Number of lots

Marina with 333 positions

20

Use of land

Use of Land Area (m2) Units

Hotel 57,180.80 4.00

Residential 105,906.30 12.00

Single family 46,164.90 55.00

Commercial 24,281.54 3.00

Tourism facility 6,120.16 1.00

Equipment 1,782.43 2.00

Green area 8,686.97 5.00

Streets 44,742.41 -

21

Table of Contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

IPD Sinaloa

23

Location

• IPD Sinaloa‐ Located in the municipality of Escuinapa,

Sinaloa, 90 Km south from Mazatlan (90 minutes).

• Mazatlan‐ Second main city in Sinaloa.‐ One of the main beach destinations in the

northwest region and in the country.‐ Fifth cruise destination in Mexico.‐ It has the second biggest fishing fleet in

Mexico.‐ Private investment of $270.5 Million

Dollars (2010).

24

Influence Area

Source: SIIMT

Mazatlan´s Tourist Arrivals (in thousands)

266 271 241312 423

1604

2010

+233%

2005

481

391

90

2006

968

1254

988

2008

12971474

2009

11621056 1181

2007

1239 26%

74%

National

Foreign

• Although Mazatlan has excellent international airlift and connectivity, the domestic market using ground transportation is of great importance.

9,3799,2198,8268,3988,3258,402

2007 200820062005

+12%

20102009

Number of Guestrooms in Mazatlan

4852

57595850

20102005 2006 200920082007

Occupancy Rate (%)

25

Accessibility

The IPD Sinaloa has very good accessibility through:

• Mazatlan International Airport ‐ Distance to IPD Sinaloa: 85 Km‐ Travel time to IPD Sinaloa: 55 min.

• Teacapan Airport* (Projected)- Distance: 26 Km- Travel time: 20 min.

• Federal Highways‐ Mexico City – Nogales‐ Mazatlan – Durango Highway (under construction)

* There is an existing air strip which could be upgraded depending on future demand.

26

Project Characteristics

‐ Total surface: 5,883.6 Acres

‐ Saleable surface: 2,351.7 Acres

‐ 12 km waterfront

‐ 100 meter beach width approx.

‐ 180º panoramic ocean views

‐ Conservation surface 1383.5 Acres

‐ Maximum capacity 44,013 Units

‐ Hotel: 11,967 units

‐ Residential: 32,046 units

‐ Land use:

∙ Residential with low, medium and high

densities.

∙ Commercial Mixed-use

∙ Hotel

27

IPD Sinaloa

28

Tourist Attractions

• Nautical infrastructure:‐ Marina‐ Island‐ Canal zone‐ Dynamic waterfront‐ Ski track

• Cultural infrastructure‐ Interpretative zone‐ Cultural center‐ Universities‐ Libraries‐ Retiree zone

• Recreational infrastructure‐ Golf courses‐ Beach clubs‐ Theme park‐ Sport module‐ Recreational promenades‐ Shopping malls

29

Master Plan

48%

11%4%

31%

6%

Land use distributionPercentage with respect to total sq/m

Trigger zone (1st stage of development) Will have urban infrastructure, hotels and commercial area

HotelCommercialResidentialTourist facilitiesOther*

* Golf course, urban equipment, green areas, etc.

30

Table of Contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

Capomo

32

Influence Zone

• Riviera Nayarit‐ Is a 160 km long corridor, located on the Nayarit state‐ Is a combination of exclusive developments, pristine beaches,

flora and fauna‐ It runs from Nuevo Vallarta to San Blas port• Riviera Nayarit attractions‐ Touristic:

∙ Special category hotels∙ Golf courses∙ Marinas

‐ Naturals:∙ Beaches∙ Whale watching∙ Tropical jungle

• Nuevo Vallarta‐ ~5,450 hotel rooms offer (4, 5 stars and Grand tourism hotels)• Punta Mita‐ 4 hotels current offer (783 rooms):∙ 2 special category hotels (Four Seasons 140 rooms and St.

Regis con 120 rooms)∙ 2 five stars hotels (Palladium Vallarta with 423 rooms and The

Royal Suites Palladium con 100 rooms• Puerto Vallarta (Jalisco)‐ ~7,520 hotel rooms offer (4, 5 stars and grand tourism hotels) Puerto Vallarta

33 Source: Sistema Integral de Información de Mercados Turísticos

Influence Zone

1217914080

17093

1308215338

1000000

0

500000

1500000

2000000

10000

0

2007 2008 2009 2010

5000

2006

15000

200001868

1114

10000

0

2000

1500

1000

500

0

2010

567

2009

697

2002

1482

20012000

1,67660000

50000

40000

30000

20000

2008

1,172

20072006

1603

2005

1,243

2004

1,282

2003

1,126

1868

567697

1603

20000

30000

40000

50000

1000

10000

0

2000

1500

2007 2008

1172

2009 20102006

500

0

60000

Passengers

FlightsPuerto Vallarta Airport (in thosands) Tepic Airport (in thousands)

Pass

enge

rs

Flig

hts

Pass

enge

rs

Flig

hts

Puerto Vallarta tourist arrivals (in thousands)

787 844 835 802800 714

-18%

2010

1104

390

2009

1223

422

2008

1432

630

2007

1431

596

2006

1493

649

2005

1342

555

Foreing

National

Nuevo Vallarta tourist arrivals (in thousands)

282 282362 337

364 388

+3%

2010

661

273

2009

625

261

2008

752

415

20072006

642

360

2005

642

360

829

466

59%

41%

65%

35%

5,9885,9765,0765,0524,7864,786

11,09911,05710,63810,72810,68910,834

2009

+25%

2010

+2%

20082006 20072005

Puerto Vallarta

Nuevo VallartaRegistered rooms

656071767979

545563646563

2005

-15%

2008

-18%

2009 201020072006

Occupation percentage

34

Capomo Characteristics

• Location‐ Compostela, Nayarit‐ 115 Km north of Puerto Vallarta; 90 minutes‐ 69 Km north of Punta Mita; 50 minutes• Accessibility‐ Tepic National Airport∙ Distance: 90 Km∙ Travel time: 1.5 hours‐ Puerto Vallarta International Airport∙ Distance: 70 Km∙ Travel time: 1 hour‐ Puerto Vallarta – Compostela federal highway‐ Chacala’s Port‐ Railroad• Regional attractions‐ Natural:∙ Sub-humid warm climate∙ Deciduous jungle∙ Palm grove zone∙ Mangrove zone∙ Diverse fauna (22 classes of amphibians, 44 classes of

birds and 11 different species of mammals)

35

Project characteristics

‐ Cliff zone, marsh and flat zone

‐ 3.5 Km waterfront

‐ 50 meter coastal beach dune

‐ Total surface: 630.7 Acres

‐ Saleable surface: 353.9 Acres

‐ Polygons:

∙ Boca de Becerros

∙ Boca de Naranjos

∙ Anexo Cuevitas

‐ Maximum capacity: 4,822 units

∙ Hotel: 1,592 units

∙ Residential: 2.996 units

∙ Commercial:248 units

‐ PGA class 18 hole golf course (197.2 Ha)

36

Capomo

37

Tourist attractions

Infrastructure‐ Golf courses‐ Beach clubs‐ Commerical zone

Recreational activities‐ Entertainment centers‐ Theme trail by marsh‐ Recreational promenades‐ Shopping malls

38

Master Plan Capomo

2%

2% 40%

3%

12%

42%

Number of Lots

Tourist equipment

Residential

Others*

Single Family

CommercialHotel

* Others: Golf Course, streets,green areas, touristic services, etc.

Boca de Becerros (First stage)

Boca de Naranjos (Second stage)

Anexo Cuevitas (Third stage)

First Stage:‐ Hotel: 3‐ Commercial: 4‐ Residential: 7‐ Single family: 47‐ Touristic Services: 4

Second Stage:‐ Residential: 2‐ Single Family: 53

Third Stage:‐ Hotel: 3‐ Commercial: 1‐ Residential: 13‐ Touristic services: 3

Land use distribution

39

Land use table

Land Use Surface(m2) Units Rooms

Hotel 307,972.70 6.00 1,591.98

Residential Multifamiliar 988,970.99 22.00 2,808.18

Single Family 66,750.18 100.00 188.00

Commercial 41,443.95 5.00 248.66

Turistic services 48,794.32 7.00 -

Golf Course 803,325.57 - -

Equipment 39,901.45 - -

Green area 20,412.50 - -

Streets 180,416.79 - -

Subtotal: 1,044,056.31 - -

40

Table of contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

41

IPD Huatulco

• Location:‐ Huatulco, Oaxaca• Accessibility:‐ Huatulco International Airport‐ Number of flights to destination in 2010:

∙ Domestic: 938∙ International: 199

• Investment:‐ Private investment: USD$ 193 millions in

Oaxaca in 2010• Guest rooms‐ 3,056 in 2010• Local and Municipal incentives to investors:‐ Tax and state rights relief‐ Payroll tax temporary exemption for new

companies‐ Tax and state rights fees reduction‐ Temporal payroll tax reduction• 84 Available Lots

42

IPD Huatulco

43

IPD Ixtapa

• Location:‐ Ixtapa, Guerrero• Accessibility:‐ Ixtapa International Airport and Acapulco Airport‐ Main Highways (Morelia – Ixtapa Zihuatanejo,

Mexico City – Acapulco)‐ Number of flights to destination in 2010:

∙ Domestic: 1,263∙ International: 717

• Investment:‐ Private investment: USD $211 millions in Guerrero in

2010• Guest rooms‐ 5,324 in 2010• Local and Municipal incentives for investors:‐ Tax and state rights relief‐ Payroll tax temporary exemption for new companies‐ Building license’s tax exemption‐ Temporal payroll tax reduction• 57 Available lots

44

IPD Ixtapa

45

IPD Cancún

• Location: - Cancún, Quintana Roo

• Accessibility:‐ Cancún International Airport‐ Number of flights to destination in 2010:

∙ Domestic: 8,259∙ International: 18,331

• Investment:‐ Private investment: USD $340 millions in Quintana

Roo in 2010• Guest rooms‐ 30,131 in 2010• Local and Municipal incentives for investors:‐ Tax and state rights relief‐ Public Registry of Property and Commerce duty

exemption‐ Property tax reduction‐ Special incentives for research and technology

development• 25 Available lots

46

IPD Cancún

47

IPD Los Cabos

• Location:‐ San Jose del Cabo, B.C.S.• Accessibility:‐ Los Cabos International Airport‐ Federal highway No.1 or Transpeninsular

Highway‐ Number of flights to destination in 2010:

∙ Domestic: 2,687∙ International: 4,772

• Investment:‐ Private investment: USD $64 millions in Baja

California in 2010• Guest rooms‐ 12,375 in 2010• 78 Available lots

48

IPD Los Cabos

49

IPD Loreto

• Location:‐ Loreto, B.C.S.• Accessibility:‐ Loreto International Airport‐ Federal Highway No.1 Transpeninsular

Highway• Investment:‐ Private investment: USD $64 millions in Baja

California in 2010• Guest rooms‐ 1,061 in 2010• 22 Available lots

50

IPD Loreto

51

Table of contents

1. Introduction- Economics in Mexico- Tourism Economy in Mexico- Tourism Investment in Mexico- Tax incentives in Mexico- What is FONATUR?- FONATUR’s Advantages- FONATUR’s Achievements- Integrally Planned Developments

2. Investment Opportunities- Marina Cozumel- IPD Sinaloa- Capomo

3. IPDs- IPD Huatulco- IPD Ixtapa- IPD Cancun- IPD Los Cabos- IPD Loreto

4. Contact

52

Contact

National Trust Fund for Tourism DevelopmentTecoyotitla #100, Col. Florida

México D.F., C.P. 01030

Juan Manuel Galarza Tohen+52 (55) 5090 4211

Chief Commercial Officerjmgalarza@fonatur.gob.mx

Alexis Ralph Pérez-GaySales Director

+52 (55) 5090 4249aralph@fonatur.gob.mx