1. Travis Allender James Boyd Ebony Branch Jeff Clark
Waldo County
Travis Allender
James Boyd
Ebony Branch
Jeff Clark

2. Agenda Background Statement of Problem New Options
Financial Info and Analysis
Recommendations
Conclusion

3. Background Waldo County Real estate developer Known for good instincts
Works long hours and expects dedication from employees
Needs financial assistance for some projects

4. Statement of Problem $90 Million Outlet Mall Proposed by Waldo County
Purpose is to intercept tourists heading towards Maine
Will this outlet mall make money for the investment that will be made?

5. New Options Task One Task Two Task Three Task Four (final task)
Summary of projected revenues and costs
Task Two
Analyze potential problems
Task Three
Analyze delays and overruns
Task Four (final task)
Calculate NPV and sensitivity scenario analysis
Task One: We need to determine if the project makes financial sense.
Task Two: Inflation and shortage of sales were concerns. We need to analyze what might go wrong. Things like construction costs, revenues, operating and maintenance costs, and real estate taxes are all likely to rise with inflation.
Task Three: Will need to look at zoning laws/rules/regulations, as well as environmental approvals we would have to get for the project. Potential for cost overruns to increase 25% up to a year.

6. Financial Info and Analysis
YEAR 1 2 3 4
5-17
INVESTMENT:
Land 30 *
Construction 20 10
OPERATIONS:
Rentals 12
Share of Retail Sales 24
Operating and Maintenance Costs
Real Estate Taxes

7. Financial Info and Analysis cont.
NPV for outlet mall:
NPV $50.24 million
Tax rate of 35%, 2% inflation rate
Construction Delays
Increase timeline by 1 year
Harmful to profit estimates
Add $2-4 million in extra operating costs
Add $2-3 million in extra taxes

8. Recommendations
Recommendation is that the outlet mall project is financially stable.
Worst case scenario for retail sales did make a large impact on figures, yet still allowed a positive NPV.

9. Conclusion Bottom Line… Outlet Mall project is a stable investment
Projected to be a money maker