Ocean View Development Corporation

Luke is an employee of ABC Company. He has been assigned to a construction of an adult entertainment retail store within a neighborhood his brother, Owen, lives in. The development of the retail store has not been made public yet and will be announced one month from today. This announcement will decrease the property values of the surrounding areas significantly. Owen is trying to sell his house. He told Luke that he recently received an ‘okay’ offer. However, in hopes that a better offer might be present itself in a few years after the real estate market improve, he has not taken the offer yet. Luke is very close to his brother, which makes him concerned about his confidentiality obligation to ABC Company.

Using the tables (shown below and in Exhibit 1) to calculate cash flow before financing and net proceeds from sale, a DCF method was used to arrive at a NPV of $216,789 and IRR of 13.3% for a 5-year holding period at assumed vacancy of 5% (Exhibit 1). As mentioned earlier, this IRR exceeds the 12.5% initially set out, and therefore seems like a feasible project. Using a higher vacancy rate of 7%, however, lowers the IRR to a point that is no longer feasible. If holding all else same, a vacancy of 7% on the building yields a NPV of $122,420 and an IRR of 11.47% (please see table below and Exhibit 2). This IRR does not meet the minimum required and therefore the assumption of vacancy rates staying at 5% is paramount to our analysis. This aspect of the analysis is considerably risky as an assumed vacancy rate does not necessarily yield a guaranteed rate. If vacancy happens to rise, then the valuation of the property is far different than what was originally envisioned.

The outcomes are as follows. Candice purchased the property for the price of $24 million. Additional to the price, Downtown Inc. will receive ten percent of the revenue generated for seven years. During those seven years, downtown Inc. will have a forty percent minority share in the property. Twenty-four of the Bullard houses will become condos and controlled by downtown INC. Those condos are located on the periphery of the structure,

New England Seafood Company executives face a potential two-stage plan to move into the freshwater catfish market because of the banned oyster harvesting along much of the Atlantic and Gulf Coasts, and increased competition from foreign producers.  These factors have resulted in significantly lower yields for New England Seafood.  In order to stay in business, New England Seafood Company needs to look at harvesting and processing something other than seafood.  New England Seafood Company looks to

1) Complete summary of the case study that identifies the key problems and issues, provides background information, relevant facts, the solution employed, and the results achieved.

If Oceanview submits the highest bid and obtains the property, the firm plans to build and

Mr. Alexander is a gentleman that is looking to build his investment portfolio through residential real estate. He is looking at investing in a 4-plex in a historical district located within Boston, Massachusetts. The building is located on Revere Street and has a listing price of $350,000. Mr. Alexander is evaluating the possible commitment to understand what he stands to gain from the annual cash flows while at the same time understanding the risks involved. The subject property is located within a historical district and is not yet capable of housing tenants. Property will require significant improvements prior to inhabitation. Client

like this: Narragansett maintains data on the average annual usage and cost of each item. Based on

Pilgrim Assurance is a case that involves a sealed bid auction. Therefore, the auctioneers will need to sell the building to the highest bidder involved at a minimum bid of $15 million. David Bailey is given the decision to decide on how much to bid for an office building. Furthermore, he needs to make the decision whether to lease it as office space or to convert this office space into condominiums. In this case, I will analyze the goals and objectives of Bailey as well as the other participants. The sealed bid auction indicates that they are willing to take a chance on the market and try to receive high bids. There is no problem with the government participant besides using permits to do renovations. There is

Option 2 (Proceed with Mid-Rise Apartment Complex, Selling in Year 10): While replacing the current structure with a more appealing mid-rise apartment complex would increase the market value of the property, it would also require financing and additional investments. Thus far, Sexton has run into several problems, beginning with the planning commission, and now higher cost estimates, financing and timing issues. Even if Sexton were to obtain financing and somehow meet the January 2005 target date, his original estimates of rental income and cash flow analysis are still not guaranteed. Exhibit 2 provides a net present value range between 103,000 and $214,000 for proceeding with the mid-rise apartment complex and selling in year 10 based on a range of cap rates.

Sales data were drawn from a new Oceanside condominium complex consisting of two adjacent and connected eight floor buildings. The 200 units in the complex are approximately 500 square feet each.

Q8: Write a report that outlines the information you have gathered and any recommendations you would make as a result.

Luke has been asked to work on a project that involves developing land recently bought by ABC to build an adult entertainment retail store. According to the plan, Luke’s brother, Owen, whom he is very close to, lives in the neighborhood that the adult entertainment retail store plan will be built. Luke knows that as soon as the plans for the store become public, the property value of the homes in Owen’s neighborhood are expected to decrease significantly. Luke is concerned about his confidentiality obligations to the company. Owen has openly expressed to Luke that he has thought about putting his home on the market for sale; this is concerning for Luke. He knows that Owen has received and acceptable offer for his home already, but wonders if the market for real estate in the area will increase in the next few years.

1. Review the case and the three Power Point presentations. Which external environmental issues/considerations should Tad take into account when evaluating the three deals?

Read the following case study and critically analyses the situation and write a report in while outline the issues and problems faced by the organization’s members. Describe how you address them. Justify your answers and give detailed reasons for your intended actions.