Steel Street Business

Steel Street
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Steel Street
1 How should the cousins deal with the cash shortfall?
Cash shortfall troubles the operations or smooth running of the project. It results in the project running behind time. The project may even halt completely. The cousins, therefore, should ask more investors to come on board for their project. As more investors come in, they provide more capital in terms of equity. Additional capital makes more disposable cash for the project. It is also a strategy to make more cash available for the project. When the cousins exploit all the above methods, they will save the project from a cash shortfall.
2 How much money will the cousins make (or loss) on this deal?
The cousins are to make a net gain of $ 2,470,819 from the project. This money is coming from the rent of the tenants.
3 How much money will the equity investors make (or loss) on this deal?
The total amount of equity channeled to the firm is $ 1,241,385, according to exhibit 2. The beginning of equity and ending equity are equal. Hence, they are not making any gain or loss. The profits earned on the equity investors are reinvested into the firm.
4 When will the equity investors be paid back for their investment, if ever?
Equity investors are also shareholders. Once they inject their share of capital into the business, they become part of the project (Pinto, 2020). It is their share of the capital contribution to the company that earns them a dividend. When the project generates more revenue, it is the revenue that is considered profit. Shareholders decide on whether to share the profit or reinvest it back into the business, then earn from the dividends.
5 Should the cousins drop the "green" elements of the design?
The cousins should drop some of the 'green' elements of the design. It is going to save them about $ 75,000. However, this act will make the building more difficult to lease, for it will not be LEED certified. 'Green' building wou...