Perang hapon (Reminder of Japanese currency in PHL during WW2) Japanese yen Y160 = $1

Looking forward to the future of business

There used to be 25 top Japanese companies in the world;   now there is only one.  Tourism is becoming Japan/s dollar earners.  It has lost its technical prowess.   Japanese companies used to be the model for management practices by this post.  It can not be longer said of Japan now.

Japan has lost out to China.  

Japan economist managers engaged in a lot of financial and fiscal experiments, like negative intereest rates, printing too much currency etc.   

The Japnese yen lost 1/3 of its value vs US dollar.  What will happen next?

Loss of drive by business partner in the Visayas

Looking forward to the future of business

Last Monday and until yesterday, we were in the Visays to visit our joint venture project in the Visayas.  

We have to see with our two eyes our preparation for the Nov 1 date where people see our project.  It is unfortunate that as usual,, our officer and people, being unsupervised (not visited ) commit the proverbial when the cat is away.

What is saddening is that our partner who is there in his 80s, lost interest in his old love - politics and in his sideline - business because his children are abroad, and his lone son with his his present wife, is having difficulties in his attention and is not serious in his life.

Should we continue with the business or divest?

Modest businesses, no losses vs large businesses of peers but with huge losses

Looking forward to the future of business

This post recently read businesses of peers (who were batchmates in college) It was noted:

1.  One heads a family business, a large, old university but which experienced millions in losses despite being in centrral location

2.  Another one heads an international food company.   His business, experienced millions of losses in $ abroad (translated to milliions in local currency.

I have to try harder not to have losses, but thrive.  Guess am just lucky, despite lacking business experience and education

Met again with prospective business partner, allegedly disinherited

Looking forward to the future of business

We met again with a prospective business partner at a coffee shop in MM.  If only to announce good news and possibility.  He borrowed money and kept on paying interest.  His prospective cash flow from payment of gasoline station lease has not materialized on account of his domestic troubles with his brother and sister

We also learned that he has been disinherited by his mother whom he watched closely at her deathbed,   But disinheritance can only be valid if there are several valid legal reasons.   (Has his lawyer examined that?

Why did IBM fail; who killed IBM

Looking forward to the future of business

While you cant drive a car looking at the rear view mirror, you have to look at the back up camera or mirror when backing up.   It certainly helps you navigate the future by learning from the past/history.

We should remember that IBM failed in its  business because of

1. Bureaucracy

2.  Related to 1 being out of touch with reality, competition and customer  

3.  Bad choice of leaders and CEO.  

You should not have this kind of structure.   Management

Evaluation of the newest housing project of the govt.

Looking forward to the future of business

It looked very attractive in the beginning what with the more than P250 billion that is available.  Couple this with the strength of the housing provident fund:    monthly contributions, loan collection

After interviewing a lot of people and reading their manuals, these are the conclusions

1.  The standards are for high rise condo:   40% open space (that means your maximum saleable area is only 40%!  There should be complete amenities

2.   There are price ceilings and margins therefore would be thin.

3.  While the EO 34 discourages developers only big time developers with tons of cash and credit line

      can execute these projects

4.   A lot of cash/equity has to be advanced prior to any release:   1.  Land must be acquired   2.  Full

      land dev.    3.   A tower must be completed, A-1 finish before any release.   For the project we                     envisioned more than P200 million is required.   We better stick to what we are doing where much

     lower cash is required

5.  The housing fund wants beneficiaries to have income.  But those submitted are just like any 4ps beneficiaries.  No job.  

While many investors would think that they can gain much from this program, (since the developers are excluded) it is the reverse.   The private sector would advance the development for this housing program.  While the greatest advantage for the consumers/beneficiaries is the 5% beneficiary. the budget by GAA for this is quite small and will not be enough for the number of units being built this year.   

So no go for us?

      

New township under the 4ph program, to be institutionalized. Rates to be only 1.25% only?

Looking forward to the future of business

Midrise housing units 4 storey, 20 towers, 100 units each

Looking forward to the future of business

Ito tinatarget natin sa queen city of Region 1.  4 storey, no elevator.    Ala bliss.    Para mas efficient.

Mga objectives na maabot:

1.  Job and employment generation

2.  Entrepreneruship.

4.  Raising standards of living;

5.  Political -  getting votes.   2K units =  x 5 =  10,000 votes for local lgu execs, and  admin mideterm senatorial candidates.      

Its National Housing Month, can we participate as contractors?

Looking forward to the future of business

Its national housing month.  At 11 am today, we are supposed to have a meeting with a senior official of the National Financing Arm for housing who happens to be the relative our partner in construction.

A 4ph housing project in a queen city was suddenly brought before our lap after we met with the executive assistant of a queen city in the north last Wednesday.

Last last last week, we were referring the 4ph program of the said city to a supposed "big time contractor " of land dev company based in Alabang,  Their deal turned sour, and suddenly two projects :   a public market (their public market burned last August) and 4ph were looking for an investor /proponent     Their proponent for the public market passed away.

For their 4ph, the proponent could not push through with land acquisition. They were promised P70 m for the land acquistiion under SHFCI  (Its head F. laxa is an acquaintance)  The 4ph is  signal project of PBBM to address the 6million housing backlog, for which P250B of the Pag ibig program was allocated.

Federico Laxa - CEO SHFCI

We have several questions for the 4ph:

1.  Are we qualified for the program?

2.  Shall the take outs be from us?

3.  Can the funder provide a credit line of P1.5m x 2,000 beneficiary?

4.  Will the take outs be fast and efficient (it was not before)

Since the senior officer is from our place (he is a deputy CEO) maybe we can get favorble reply

.   

 

On line seller killed over debt? Its fearful to lend extend credit

Looking forward to the future of business

A couple was assassinated by who appears to be their friends and compare/comare.  But who owed them P13 million.   One could be killed over debt (the lender).   I have relative who died several months ago over the same issue.  

Focus vision for the eco zone

Looking forward to the future of business

We conferred with the chief executive regarding an ecozone being organized at a premier city in Region 1.  All that they can say is to invite locators from a nearby city which is sinking due to liquificat=ction

Can we make theis a manufacturing hub?   It has no shipping port which is conducive to manufacturing.  The nearest are in Subic and Poro Point.  But they are near and are 2 - 4 hours away.   About 200 km away.

My eldest that their ecozone should be focussed on a niche or indusrty.  One that does not require huge cap ex from the govt.   One such sector is IT:     data, cloud center.  Cyber zone.  Where you can outsuruce IT jobs like programming and apps    Many excellent workers in BPO and IT and MM are from Pangasinan.

But of course the power supply from the grid and IT (fiber optics link) have to be upgraded.  

More business opportunities - public market and 4ph

Looking forward to the future of business

This post introduced a broker/agent to the principals (EA of a major in major city in Region 1)  However the agent and his principal carelessly dropped the same by negotiating over the phone and advancing a crazy deal.   They did not examine the opportunities by crashing head on with their offer which the party from the north promptly dropped.  These were about a public market venture (their market just burned down) and 4ph (which the principal agent were looking for.

The market deal:      It involved an almost one hectare property and can be built on 2- 3 storey configuration and revenues can come from monthly rent, parking and rights.   The revenue can amount to 

(at 800 estiated locators )   P80M for rights, over P300 m in parking fees and P1,600M in rental for the next 30 years.  Rent will be at P32/sm.  

The housing 4ph  They have a ready package good for 2,000 beneficiary, on 4.7 hectare property.  While I though this was on public land, contractors have to obtain the site.  I will cost 77 million, for a site near the center of the city.   27 sm, 4 storey,   Cost not more than P30,000 sm, selling price not more than 42,000 sm.   The estimated Gp here is P300 - 400m.

The principal whom we talked last Friday, who did not do their computations are frantic in running after these deals, But the principals from the north would not like to do anything with them anymore    They would like us to do this for them.  We have in business for more than 20 years. 

This is on top of a memorial park we are about to buy and 3 hectare expansion of the exisiting project we have.

Business opportunities or telenovela series on Quadcomm hearings

Looking forward to the future of business

During ther past several weeks much of the time of this post was spent on watching the new telenovela series:    prosecutor like grilling of political personalites, alleged romantic relationship between former Pres and GM of a charity office, killings in a jail, link between police characters and informants.  I realized that they were not paying for my meals, but they were getting free ones, and were probably bribed big money to do this hearings. 

So I made an inspection trip and on the side tried to look for opportunities.  And opportunities there were.  This office brought a long a business and real estate agent who represented two friends:   one a solar senior officer, and other one a seruveying quantity firm making forages into real estate ventures.  We could be agents, brokers, consultants. to the following:

     RE

    1.  Prospective solar farms for sale or lease

   

         1. We can broker the project

         2.  Flip -  take a position on the land, and resell the propert y at a higher price once a deal goes

                         on

         3.  Permanent ownership -  buy the land, lease it, for say 5 years, with % increase on the 6th year

              and take equity on the lessor, participate on the RE

     2.  RE company for sale.   Onwers are quarelling.

     3.  Cooperative seeking funder, and/or builder of minihyrdro.

  Real Estate:

    1.  A city whose public market burned is willing to give a lease contract on a developer who

         can rebuild its project

   2.  Solar farm 100 hectares for sale

   3.  Eco zone looking for an operator.

   4.  Citylooking for a builder in the   4ph program program.  

      P250 b allocated for this via PAG IBIG  DHSUD through Sec Acuzar will spearhead the project  

      (teh LGU will provide the inventory of public lands for such housiing, and apply for developmental 

      land of the site.    The 4ph is contaiend in EO 648

The agent has a principlal who is going to this govt project.   It is not clear whether they  can build, finance  the project.   Or willing to get their hands dirtied.  

The opportuntity for RE is $66 billion, or P3.696 trillion pesos, for 40ph is  Php 250 billion.  Thousands of job would be made advailable,  say 10,000 plus the multplier effect   (4 trillion x 10  =  P40 trillion in additional GDP.  Thats a lot

What caused Romes decline? Is there a parallel in modern world

Looking forward to the future of business

These were mentioned as causes of Romes decline (mostly economic)

    1.  Heavy taxation

    2.  Inflation (debasement of currentcy)

    3.  Trade disruption caused by invation and internal strife

    4.  Reliance on slave labor

\   5.  Unemployment -->>>lack of finance for military

Causes of Roman Empire decline

US $35 trillion debt costs $3 billion a day (or $1 trillion a year); when will US solve this challenge

Looking forward to the future of business Savings from oil and coal importation

We could not generate that much profiit in a year (that is P150 billion )  We are lucky to make a million PHP a year.   And yet that is the reality of US economy and financed.  That is the downside of Keynesian ecoomics (deficit spending to pump prime the economy)

Nobody is the US Legislature is taking steps to balancee the US budget and solve this debt crisis:

    1.  No plans to increase revenues and reduce expenditures? 

    2.   Everybody in US wants to spend more and more:   for US military, foreign aid, more federal spending

$3billion a day interest for massive US $35 trillion debt

Developers role all but forgotten

Looking forward to the future of business

We were real estate developers about 3 decades ago.  The projects we had abutted the highway: 4.   Three were  were housing subdivsions and one was a memorial project.   

The frontage of the 3 housing subdivisions are now all commerical contributing to distinct skylines of this municipality.   This town has now but become highly commercialized.  About a dozen fast food establishments are located in projects this post built.  Land values zoomed from P350.00/sm to P60,000 per sm.   Quite a big income for the land buyers we had, and huge contributions to RPT or LGU, and huge CGT to BIR

However, we developers are simply in the background and all but forgotten.  Only self serving posts like this give me/us psychological income for having engaged in such a project

Jollibee at Unishoppe

Jollibee at Richmond

Consultation on holding company, exchanges between shares of stocks and real properties

Looking forward to the future of business

My youngest daughter and I had working lunch yesterday re corporate structures:

1. The Alice Guo case had some deep lessons on corporate affairs.  The purpose of multiple corporations are to create corporatre veeils which seemed to have been pierced.

2.  The viel curtains you from piercing eye of public and tax collectior.

3.  Establish M as holding company.  It will hold shares of stocks from various units.

4.  The holding of various properties and corporatins must be justified by cash infjusion.We learned from Makati boys how to maneuver sales of properties without actual cash out..  Its a secret

5. Match corporate structures with organiational strengths and performance

6. Maintain edge and majority as you establish crporate structure.   An equal sharing results in stalemate and in my case an ouster.    

Wealth creation for the consultancy

Looking forward to the future of business

Estimate of monetization of consultancy last Sunday:

1.   For development   -              P10,000,000

2.   RA 6552 (forfeiture clause)       P500,000

3.   Partial cancelleation in CTS    2,000,000

Must be about P10,000,000 -  12,000,000

Cost reduction, sound advice create wealth.   Experience count.   Mistakes and legal binds are avoided

Fmr employee solicited advice on a real estate project

Looking forward to the future of business

A fmr staff, millionaire wannabee asked help on a project doing a 6000 sm compound - titling this and selling on installment.  She had a plan for 60 sm a piece to be sold at P6,000 to P6,500/sm.  And still planning to buy the adjoining property for a staggering amount.

My advice:    on current porject

1.  Review pnl, what is going to be the promised amenity.  She plans to develop the property with roads etc.   I asked for the area of road lots.   Its  1,600 sm or roughly 40% of the gross area.   And if there is going to be development, she is going to be in the red.  The road development would cost a good 8 digts.

So be sure to sell this like the others on a as is where is basis.

2.   For the legalitties:

     1.  CTS with buyers -   insert 6552 on the Offer to the purchase.  Forfeiture if there are arrears

                                           state clearly that it is undeveloped property.

     2.  For CTS with the raw land seller -  that she can borrow the title when the time comes for the issuance of individual title.  That she can ask for partial release and cancellation for payments tht she has made.   

For her expansion:

1.  Do nothing at first since there is no ROW for the adjoining property (which she is developing now)

2.  Propose a jv, direct sales from the land owner to the buyer.   Go for 70-30  + 5% for the ROW

     Insert the same provision as in 1.2.2.   She can sign the DOAS for fully paid plots.

Many newbies and wanna bees have a lot to learn from aged business perrson