Complications being encountered in a deal

Every generation needs a revolution - an entrepreneurial revolution

A deal that we were into went south because the brothers did not agree and wanted sale instead of JV.  So there was a replacement.  Another 3 hectare which looked like a good site.

The other brothers whom we were dealing with heavy equipment several years back were all ready done for. The father all ready said yes.  It was a matter of shaking hands.    However they said they were waiting for a half brother who would come from the states to seal the deal.  

However his conversation veered towards sale.   To which I said to sell this untitled property would be extremely challenging because the Guido case has made titling next to  impossible.  He wants a valuaution to which no appraiser would agree to because his property has no title.    He wants me to make an offer first  but we had no documents .   Certainly not the wisest way to do business-  making an offer for real property whose boundaries, docs number you do not know?  Not even the owner?

The other brothers may be realized this is a good deal that is why they are willing.   The new entry (a half brother) was trying to get attention.  They should be thankful for such an offer

Maybe Guido just like in Maclang would buy them for P1,000 per sm.   Investors have avoided land purchase in this area because of Guido case.  God bless them.   

The Lord knows best; when a door is closed he has better deal for you.

Every generation needs a revolution - an entrepreneurial revolution

In the recent deal proposal and evaluation several were botched/did not proceed

1.  The 2600 sm property which we planned for a higher end residential.   The owner wanted P7,500/sm

     we bided only P6,000 because this input is what the market could take    At 7,500 + 2,000 dev                     cost/0.60 = 15,333 BE.    Retail plots at P20,000/sm to make a decent profit.   100 sm x 20,000 =  2M

     The selling price of a nearby subdivision is P12,000 only (P2,000,000 for a 180 sm property)  We               would be pricing ourselves out of the market.   Anyway, the seller gave a deadline and never more 

     responded.

2.  A 9,600 sm property located in a criminal laden site.   The owner was difficult to deal with being

     a former state university activist bad boy.    The property terrain is anti good feng shui and 

     had a cliff like depressed portion.  The seller said there is better access road but he could not show

     this.   We will forego of this project

But there were new opportunities and therefore, the Lord knows best:   There were better replacement:

B projects

1.  A 7.2 hectare project in NW Luzon a jv, this will save a lot of PHP for land acquisition.  Located in a tourism city and sales could reach B, because the product competition is priced at P100k+

     7.3 x 60% =  43,800/2.5 =  17,520  x  80,000 = P1,401,600,000

2.   A possible jv for a mp in town with 300,000 population for 1.4 + 4 hectare good for a yield of

5.4 x 60%/2.5 =    13,000 x P 80,000 per plot =  P1,080,000,000

3.  To substitute for #1, there is a 4,600 project located on the highest point of a hill located near a shrine that is overlooking that is priced at P2,700 per square meter.   We can do this as premium overlooking project.  

                          4,600 x 2,700  =  12,420,000    

                          BE    12,420,000  x 4,600,000/0.60   =   10,811  (dapat P15,000)   

                          HL premium project

4.  Another commercial residential   26000 sm kapapanalo lang sa Supreme Court.    say 

                      6,000 for commercial/sale lease   x 15,000  =     90,000,000

                      20,000 x 5,000                                                   100,000,000

                     Payag ng JV

 

JV again

Every generation needs a revolution - an entrepreneurial revolution

A business acquaintance called me yesterday from a tourist island province.   She informed me that the botched land purchase we had (due to competition) is not proceeding smoothly.  Apparently the same problem we had was encountered by the mogul buyer, a big name in the industry

We dont mind this though because we a have jv in a tourism city in the north and it could be jv.

So the business partner informed me that to avoid the competition in the island province, we would shift to an AB market say 3 to 4 hectare and probably jv.  

A jv would be preferable because you save the cash flow for land acquisition and you can proceed right away with development and construction.    The landowner is assured of continuous source of income and becomes part of price increases

We hope we can be successful in both