I.

TITLE

MANILA BAY LEISURE ESTATE PROJECT

II. TIME CONTEXT

2006 - Present

III. VIEWPOINT

Ybarro Sangre Properties Inc.’s consultant

IV. STATEMENT OF THE PROBLEM

Capital deficiency in sustaining the maintenance of the non-performing asset
in securing from abrupt deterioration and implementation of the project plan.

V. STATEMENT OF THE OBJECTIVE

Acquiring new co-owners or foreign investors in order to be capable of
securing the debt obligation where the borrower did not paid the previous debt for
the 2006 and attracting local and foreign investors to venture in the project
implementation for the years up to present.

VI. AREAS OF CONSIDERATION

Strengths

 Where project is to commence has a good geographic location.

 Having a high inflation rate that will attract foreign investors.
 The chamber also granted fiscal incentives for the sale of bad assets from financial
institutions to SPV companies.

Weaknesses

 Misunderstanding in the Memorandum of Agreement as for the admission of the

new foreign co-owner, Henry Tan.
 The project was temporarily suspended.
 Insufficient funds for the implementation of the project.
 Owners could no longer provide additional investments for the preservation of
assets.

Opportunities:

 Massive influx of money from foreign investors and remittance from overseas
Filipino workers.
 Different Government Programs to make tourist destination in the Philippines more
appealing.
 Charter Commission proposed “Protectionist provision in the current constitution
and welcome the entry of foreign investors in areas previously reserved to Filipino
citizens”.
 Improvements of infrastructure in Pasay and Parañaque that will attract investors in
both foreign and local.

Threats

 Due to the financial crisis that hit the nation for the year 2001, No financial
institution is interested in investing in the project.
 Recession of Philippine economy due to the political instability and the presence of
security threat for the year 2006.
 New entrants of the same project will divide foreign and local investor.
 Decreasing inflation rate will affect local investors who already invested in the
project.
 Rapid turnover of investors in Local and foreign due to unstable economy.

VII. ALTERNATIVE COURSES OF ACTION

ACA 1: Admission of new local and foreign investors

Advantages
 It provides financial assistance to
support Capital deficiency.
 Less burden on the part of the
investors when loss became present
Disadvantages
 High expectation for returns from
their investment.
 Dilute other investor’s interest

ACA 2: Enter into a business loan

Advantages Disadvantages
 Loans and other payables are not  Loans are not flexible
demandable.
 Banks are convenient and accessible  Banks become secured creditor
with collateral over the business
assets.
 Tax benefit
 Non-profit sharing

ACA 3: Changing its business structure into a corporation

Advantages Disadvantages
 Good source of capital  Double taxation
  Perpetual life  Time and Cost of Incorporation
 Credibility  Following Corporate Formalities
 Limited Liability

VIII. CONCLUSION

CRITERIA ACA 1 ACA2 ACA3

Raising Capital 2 3 1

Attract foreign 3 1 2
Investor
Cost 3 1 2

8 5 5
Total
Legend: 3 being the highest, 1 the lowest

IX. RECOMMENDATION

We highly recommend ACA 1 because among the three given alternative

courses of action, the most beneficial thing to do is to admit new local and foreign
investors because we think that they need is investors as for their company.

X. ACTION PLAN

ACTIVITY PERSON INVOLVE TIME FRAME

 Attract Local and Danaya 1-6 MONTHS
Foreign Investors

Improvement of Mr. Tan 1-3 MONTHS

investment incentives