In trying times like now with COVID19 pandemic, there may be a lot of us will start thinking of how to raise that cash that will sustain us at least for another 6 months (financial planners call that minimum burn rate period). With the looming extension that Philippine COVID19 IATF is contemplating on, it may be 2 months of our savings (if one has) will be consumed by the end f the ECQ. And if a Filipino is not thinking in the manner of saving with at least 6 months emergency fund, then this is where awareness on should also be raised.
I heard in one online interview that CD, his actual initials has about 24 months of emergency fund. CD is into lecturing and tutoring about financial wellness. CD is a also into real estate investing. CD said that when the ECQ has been relaxed, he will be seriously into buying equities on the local stock market. I personally understand what the logic of his thinking. And if I were really in his position of at least 24months of emergency fund I will use the 18 months worth and ride on the bull run while prices are low.
Now but going back to my thing of helping business and property owners, many businesses are anticipated to not only struggle but also fail. I am not trying to be a doomsayer but it is a reality. Many business owners will do either 3 things:
- Sell their business. Business owner that is selling will find it tough to sell because there will be 2 issues of having the business stay afloat and finding out ways that the business will be sold a t the right time and at the right price without much hush from employees, suppliers and competitors. Business owner will also want qualified buyers who really have the money and that owner will ultimately be paid. Here is where a business broker like me will kick in.
- Get a new equity partner in. Business owner will really have to answer a hard question: “Do I want to still be in control? Or, will I prepare for an exit strategy by having equal or less control until I get my payback?”. Here is also where a business broker like me can come in.
- Just find a way to survive at all costs. It may take long and there will be real hardships, sleepless nights, trials and errors perhaps. In the long term, should that business will shore up from the difficult situation, then I will really salute that business owner for being resilient. On the one hand, a business failure, that business owner may end up with #2 and #1 above
Having a business and having a property are somewhat different. However different they may be there are almost similar behaviours by both owners:
- Sell the property outright. A FSBOO (For Sale By Owner Only) really takes longer. Not only that, there is also the tendency to sell higher than the going market rate at the time it is presented to the public. Or, it may also be offered at a losing position compared with going market rate. And market rate should be understood always as asking one’s self, barring the issue of location or desirability of the property, if it is aIready a buyers’ market or a sellers’ market.
It’s really best that seller-owner will seek a real estate broker’s service.
- Make the property productive. A property owner who does not want to sell and does not really have much fund to develop, maintain and sustain, there may be 2 options:
a. Lease the property as-is
b. Joint venture
In either case, a knowledgeable and competent real estate broker is able to help
It is always the desire of Cabana Business and Real Estate Brokers (CBREB) to keep in touch with business and property owners and help in whatever way.
CBREB is supported by a team of commercial brokers in 2 different entities: Keller Williams and LINK Business Philippines!
Let me know how we can help you.