Executive Summary

The case discusses the situation where Halls are planning to attain the financial help from a local bank, Shore Bank which they consider to be the ideal institution to finance the office building project. Halls had the opportunity to get a finance price of $140,000 for the purchase and $685,000 as a renovation loan amount for the same. Therefore, it can be said that the focus of Halls to actually invest upon the redevelopment of a derelict building in Chicago does have the support of a local bank.The different options that were available for Halls will be to attain loan, invest in the property or the project and finally make the purchase at a decided purchase.The more feasible recommended solution based on the situation presented in the case, Halls should look to acquire the loan for the renovation of the building.

Analysis

The case basically discusses the situation where an office building needs to be redeveloped in the city of Chicago. As the case depicts, the two major stakeholders, Clarence Hall and his wife Lisa are looking to find ways and method where they can find suitable options to redevelop a derelict office building in Chicago.

In addition to this, the Halls are planning to attain the financial help from a local bank, Shore Bank which they consider to be the ideal institution to finance the office building project. Halls had the opportunity to get a finance price of $140,000 for the purchase and $685,000 as a renovation loan amount for the same. Therefore, it can be said that the focus of Halls to actually invest upon the redevelopment of a derelict building in Chicago does have the support of a local bank.

The major issue in spite having the financial basis covered is to actually identify the method, the more convenient one that will make the deal a lucrative one for the Halls and the bank simultaneously. The different options that were available for Halls will be to attain loan, invest in the property or the project and finally make the purchase at a decided purchase. Based on this situation, the bank becomes a major stakeholder in decision making where the results do favor both the parties more specifically.

Make the Recommendations

The alternative presented in the case and the overall situation that has been discussed within the case, it becomes a difficult decision for the Halls to make the best solution to find the investment amount for the redevelopment of the building. In such a situation, with increased expenses and miscellaneous expenses including the ways to bring in the tenants to the office, all the obstacles and issues do remain a concern for the Halls, however the options that need to be considered by analyzing all the options available, the two have to find the best or the most feasible recommendation for the same.

Give Loan for Office Building: The first option or alternative for Halls shall be to attain the loan of $685,000 and invest in the redevelopment of the office building. This will help the Halls to have complete control over decision making and it shall help the execution of plans and strategies in an organized manner. The idea of loan will allow Halls to make plans that can help better execution of strategic objectives. Therefore, the first alternative is to attain loan from Shore Bank.

Invest in Office building: Since the project is already a success, Shore Bank is ready to take up the office building and meet the required development needs and overcome the issues prevalent within the building. By doing so, Halls can make an easy decision and get reasonable profits out of the project. This is one way to not become a direct part of the project. However, the option does not give the control and the decision making to Halls.

Purchase the building The third and the final alternative for the Halls are to purchase the building and then work accordingly. This option sounds the most feasible one but it requires a lot of money to invest which at the current moment is an issue for Halls. Therefore, the major concern that does come up with the alternative is to raise the required finances and to pay off the loan amount including the interest.

Recommendation

The more feasible recommended solution based on the situation presented in the case, Halls should look to acquire the loan for the renovation of the building. This most easy method of having the complete command and control over the decision making and it will also help in executing the plans and remain directly relatable to the project and its outcome. Therefore, the recommended solution shall be to have the loan and once the initial projection is completed, the management can rent out the project and generate money for the next phase of the project.

Action Plan

• Loan at minimal interest rate

• Initiate the redevelopment

• Advertise space and offer space for office

• Offer deals for the tenants

• Use the money gathered to redevelop the next phase of the building

• Pay off the loan

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