An International Students Hostel Start Up Project in Accra-Ghana

Seeking US$2,800,000.00 to build a hostel near a university in Accra. The investor will enjoy a 40% equity share or interest rate of 3.5%. Payback in 5 years.

Executive Summary

The purpose of this business plan is to raise US$2,800,000.00 for the development of a hostel facility while showcasing the expected financials and operations over the next five years. The Company is a Ghanaian based company that will provide students and other individuals both local and foreign with an outstanding hostel services. The hostel location is near the CENTRAL UNIVERSITY which is located at NINGO/PRAMPRAM in the Greater Accra Region of Ghana and the Chief of the precise location is a board member of the company. The Company was founded by K. B. Amusah.

Products and Services

The Company will provide very affordable rooms to students and individuals who are seeking accommodation for their studies or other accommodation facilities. Primarily, the Management anticipates that students and individuals both local and foreign who are seeking for a cost effective accommodation will patronise the Hostel because of its location. The business will have multiple revenue streams, which will allow the business to achieve maximum profitability by providing all hostel services that students and individuals would want from one location like Swimming Pool, Tennis Court, Fitness Centre, Business Centre, Shopping Centre, Pharmacy, Cafeteria, Internet café, etc.

The Financing

The Company is seeking to raise US$2,800,000.00 from an individual or institution who is prepared to partner the company in order to build and operate a Hostel Facility. The terms, interest rate and loan covenants are to be determined during negotiation. However, the business plan assumes that, the business will receive a 5 year loan with a 3.5% interest rate due on the outstanding principal balance. The financing will be used for the following:
• Development of the Company’s Hostel location
• Capital to purchase FF&E for the hostel in the first year and the second year, the hostel will start operating to generate income for the running of the hostel and start paying for the investment.

My direct competitors are those existing hostels in the area but they are not close to the university, and my indirect competitors are individuals who have given their houses as rented hostels. My advantage is providing a complete international hostel facility with comparative rates and a home feeling facility which other hostels in the area do not have. These facilities will attract holiday travellers who need nice and homily environment to stay for both long term and short term.

Competitors will try and repeat my success by putting up facilities like mine but will always be behind because I will be improving on mine and introducing new innovations in the business.

The location of the hostel is ideal because of the proximity of the hostel to lectures halls as most students will prefer staying close to the school. I will also be dealing with the university authorities in terms offering them commission for marketing my hostel to both new and existing students and introducing bus services to students at a minimum cost to and from the school and hostel which will also serve as an additional income generating source for the business. I will be planning for expansion in future by buying another land and building another hostel in the same area.

My experience in the hostel business has shown that there is money in the industry and plenty of investment opportunities in Ghana. Day in day out a lot of people are seeking higher education to brighten their future and the young ones who are also coming up need good education in a perfect environment which the schools are finding it difficult putting it up.

The funding need is for buying the land and building the hostel, also buying fittings, furniture and equipment with all the initial expenses till the hostel is ready to start operating.

I am seeking self-financing because I want to build an international hostel, operate it successfully and if whoever will partner me will agree, than we go public by selling part of our shares to the public.

I need just one round of financing to set up the business and any other financing will come from the income generated by the business.

Yes, I am looking for a debt investor to give me a loan of US$2,800,000.00 which will be paid back in five (5) years with an interest rate of 3.5%.
I will need a silent investor who is free at any time to request for progress report on the project.
The investment schedule payment is yearly.