1. Vision: A Premier Coastal Community
Mission: A Dynamic and Welcoming Community with an Exceptional Resort Lifestyle providing
Premier Amenities, Services and Programs
Long Range Planning Committee (created by POA in 2014)
Sea Grove Jack Phillips (Chair)
Antigua (1) Kevin Dwyer
Barbados (2) Wayne Starr
Cayman (3) Patti Commers
Grande Dominica (4) Bernie Hirl
Grande Excelsior (5) Phil Roby
Grande Phoenician (6) Barry Karson
Grande Geneva (7) John Dowd POA Board Meeting
May 18, 2016

2. Two-Year Step-by-Step Process
Mar/2014: LRPC created by POA to advise on Future of the Dunes
Oct/2014: LRPC & POA guided by Kopplin & Kuebler
Dec/2014: Survey of Owners
Jan/2015: Five Focus Groups
Four Workshops with POA, LTPC, & Key Staff to develop Vision, Mission, Core Values, and Strategic Plan
Feb/2015: Facilities Master Plan Group is essential to Strategic Plan
Feb/2015: Eye-opening visits/meetings with Vanderbilt, Stonebridge, Wyndemere
Mar/2015: First Town Hall Meeting
Seminars on Trends & Critical Success Factors. Fitness/Wellness, Education, & High functioning leadership team were headlines.
Oct/2015: FMPG/POA hires Don Stevenson Design & Lotus Architecture
Dec/2015: Sixteen Focus Groups
Mar/2015: Five Town Hall Meeting to present Concepts; posted on Website
Apr/2016: Opinion polls of concepts by Owners
Long Range Planning Committee

3. Responses of April 2016 Opinion Polls of Owners
Of the 634 Dunes units,
402 units or 63.4% gave their opinion.
Two-Story… units or 47.5% favor
One-Story… units or 30.6% favor
Do Nothing or Renovation units or 21.9% favor
402 units
Long Range Planning Committee

4. LRPC Recommendation to POA
On May 4, 2016, the Facilities Master Planning Group (FMPG) and LRPC met to decide the recommendation to the POA.
The FMPG (John Waner, John Harris, David Livengood, Bill Pollock, and Arell Harris) “unanimously agreed the Don Stevenson two-story design is the design concept that best meets the current and future needs of the Dunes.”
Based on the FMPG recommendation and the latest opinion polls by building and across the Dunes, the LRPC voted 6 for Two-Story; 1 for the One-Story; and 1 to Do Nothing.
Today, LRPC recommends the POA propose the Two-Story Project to Dunes Owners for their vote.
Jack S -

5. Two-Story Project Includes
Guard Gate Entrance
Around the Pool
New Sea Wall
New Tiki Bar with increased seating, limited menu kitchen, pizza oven
Increased Covered Outdoor Casual Dining
Increased Terrace Seating/Dining
Increased Pool Deck Seating
Splash Pad for Children
Tiki Bar Restrooms
Cottage Renovation
Main Building – 1st Floor
Enlarged Kitchen
Redesigned Indoor/Outdoor Casual Dining with Indoor/Outdoor Bar
Private Dining Room for small groups
Redesigned Fitness Center & Spa & Physical Therapy
Group Exercise Rooms
Coffee-Internet Café
Enlarged Tennis Pro Shop

6. Two-Story Project Includes 
Main Building – 2nd Floor
2 Connectable Community Rooms with Service Station for food/drink and connecting Outside Balcony with Retractable Awning designed for owner functions like:
Community/association meetings,
Smaller speaker and education programs,
Bridge,
Mah Jongg …
Multi-Function Room with Outside Covered Balcony, Outside Balcony with Retractable Awning and Service Station for food prep and drink for owner activities like:
Larger owner private events like birthdays, wedding receptions,...
POA/Town Hall meetings,
Speaker Series,
Art on Canvas,
Bingo,
Talent Show, ...
The design of the Community Rooms and Multi-Purpose Room allow for simultaneous events and provide flexibility to meet owners’ needs as they change over the next 5, 10, 15 years.
Consolidated office space for Arell, Brigid, Nicole, Accounting, F&B manager, and Chef including conference room, break room, equipment, and supply storage.

7. Why is the Two-Story Solution Being Recommended?
Everyone on the FMPG and LRPC are owners at the Dunes. None of us take the decision lightly, nor want to spend money ineffectively. We are proud of the Dunes and want it as a Premier Coastal Community.
LRPC recommendation considers many factors. Paramount was providing current and future owners with improved amenities, with space and flexibility for the future, as well as protecting or increasing owner’s real estate value. Any of the concepts is a major investment and will exist for 20 years. Polls of those responding favored the Two-Story Concept (47.5%) over One-Story (30.6%) over Do Nothing/Renovation (21.9%). We considered the owners’ comments, Vision, Mission, community trends, and competition.
Our amenities are over 16 years old. The Plantation Club looks dated and struggles due to lack of space to meet owners’ demands for food service, fitness facilities, meeting rooms, favorite activities, and new activities. Plus the Dunes management team is spread across campus and off-campus which hurts operational coordination. We also realize we are fixed at 634 owners and we have a fixed footprint for the Plantation Club.
Except for the % who want to “Do Nothing”, most of Dunes owners see the need to do “something” – either Renovation, One-Story or Two-Story.
FMPG analyzed Renovation, even a staged Renovation over a period of years. It is the highest cost per square foot approach, with the least physical return of amenities.
The One-Story is a major improvement, but still has drawbacks from Day One. The dining room will still be the space for most meetings and activities. In our last season, there were countless meetings, weekly bridge and Mah Jongg groups, Speaker Series, talent show, wine-tastings, bingo nights, fashion show – all held in the dining room because of lack of alternate space. Off-site conference rooms were also used due to space conflicts.

8. Why is the Two-Story Solution Being Recommended?
The Two-Story provides everything the One-Story offers plus space designed for owner functions:
All of these meetings and events listed before would be held in the Community Rooms or the larger Multi-Purpose Room rather than in the Dining Room.
New activities and events that owners want can be accomodated
Both large and small private owner functions and parties can be held.
Conference rooms and smaller meeting rooms will have equipment and supplies for that purpose.
Simultaneous events can be held.
General Manager’s team will have productive office space.
Our Plantation Club area footprint is fixed so additional space comes by building up. Adding the 2nd story has the least cost per square foot and minimizes construction disturbance.
Investing in new amenities will maintain or improve the competitiveness of the Dunes in the real estate market. The reverse may be true especially if competing communities are investing and our community is not. Audubon, Stonebridge, Colliers Reserve, Pelican Bay, Quail Creek, Mediterra, and Kalea Bay are examples of competitors investing.
For all of these reasons, the LRPC is recommending the Two-Story Design to the POA because we believe it is the best for the Dunes – now and in the future.

9. Estimated Two-Story Project Costs
Our current estimated costs are as follows:
Renovation of Guard Gate… $300,000
New Sea Wall & Renovation of Cottages ,000
Buildings…………………………………………… ,400,000
Furniture, fixtures and equipment……… ,000,000
Construction loan interest costs… ,000
Contingency………………………………………… ,000
Total ,660,000
Less estimated applicable reserve funds (500,000)
Estimated amount to be financed……… $10,160,000
Working with our architectural and construction professionals we have obtained an estimate of the costs needed to deliver the new Plantation Club, Tiki Bar and Fitness Facility. Upon approval of this project by the owners, the Board will then seek bids for the construction and all elements needed to finalize turn-key facilities.

10. Estimated Construction Timeline
Apr Groundbreaking Ceremony
Apr 2017 – Construction begins
Jan 1, 2018 – Complete and ready to use
Guard Gate, Cottages, Sea Wall,
“Around the Pool” – Tiki bar, pool deck, outside seating, splash pad, …
“First Floor” –kitchen, indoor/outdoor dining, bar, fitness, group exercise, private dining, café, tennis pro shop
Jan 1, 2018 – 2nd Floor of Building closed in and ready to finish
Option 1: Complete in Jan/Feb 2018 during high season
Option 2: Complete in May/Jun 2018 during low season
POA decision
Owner & Renter Options during Construction
Long list of reciprocals from May 1 to October 31.
In-season reciprocals are being negotiated.

11. Financing and Payment Options
Bank Offers: Several banks are willing to provide construction loans that cover our costs from the beginning until the end of construction which then converts to a 10 year fixed interest rate term loan that is repayable in equal quarterly installments.
Owners will have two options for paying their portion of the project costs:
Option 1: Pay 100% of the costs upfront. This amount is currently estimated to be $16,025. Owners avoid the payment of financing costs that will be part of each quarterly assessment.
Option 2: A 10 year repayment plan. Under this plan, each owner will be assessed quarterly for their share of the debt service cost (principal plus interest). This amount is currently estimated to be $500 per quarter or $2,000 annually. Owners get to keep their money day 1 and will only be obligated for quarterly assessments while they own their unit. In the event of ownership transfer, the new owners will be obligated to pay the remaining quarterly assessments.

12. Estimated Net Operating Cost Increase Per Year
Gross $/Year Per Unit $
Increased (decreased) costs:
Additional maintenance staff (2) $100,000
Building supplies ,000
Utilities ,000
Insurance ,000
Offsite office rent (24,000)
Reserve contributions ,000
Total $582,000 $917/Year $ quarterly
Increase in sales +20% (150,000) Net ,000 $681/Year $ quarterly
Discussion
We generally believe that the cost estimates are conservative. For instance, utilities were projected to increase based on square footage increases, however, newer buildings should operate more efficiently such that costs per square foot will decrease in a new building. The contribution from a 20% increase in sales based on 2015 actual sales of $1,266,000 and our 59% margin which yields $150,000 contribution.
Four Naples private communities had post-renovation Food & Beverage Sales increase by: Club A – 24%; Club B – 50%; Club C – 63%; Club D – 22%. Average increase was 40%. Source: Kopplin & Kuebler.

13. If POA Approves, Timeline to Vote
May 18, 2016 – Announcement of POA decision
By June 1, 2016 – Information Package and Voting Instructions sent to all Dunes Owners
Between June 1, 2016 and August 1, 2016 – Dunes Owners study, decide, and vote
Dial in Conference Call opportunities to hear proposal information and ask questions
LRPC representatives and their teams with follow up with owners
By August 5, 2016 – POA will announce the results of the vote

14. The Dunes is a Premier Coastal Community
[aerial picture of The Dunes]