Where we go wrong in our calculations -
Specifically in farmlands and tourism projects
Leisure aka hospitality industry under the tourism sector is an lucrative investment, so long the core purpose is focused
Locational advantage, property features, guest relations and hygiene are the key factors which the travellers look for
When a project in this sector is designed to offer investment cum leisure, then the focus must be on that and not on 👉 Investment for value appreciation and rental returns
Since vacation industry is highly prone for shift in the preferences of travellers and an assured returns on investment will become a burden that drains the income from guests
This will result in the promoters borrowing money to manage the property whose interest component will further lock the growth of the project
Such projects facing dire situations because of this kind of project planning should take timely measures to set right the wrong to sustain and survive
Revival options can be -
1.Have an open conversation with the individual investors, highlighting the state of the project and seek their support to sustain by revoking the rental income returns and replace that with an extended period of property maintenance because a property without maintenance is of no value either to the investor nor to the promoter
2.Prepare a workable business revival plan and share the same with the lenders and convince them to offer a moratorium period to overcome the current situation
3.Partner with an influential tourism promotional team to enhance the reach of the property with multiple potential guests, including event organisers and vacation curators
4.Optionally, employ a financial consultant to prepare a consolidated status of the property in terms of real-estate value, transperant P & L balance sheet and the value per share and invite like minded investors to buy shares and participate in management
It's crucial to reduce the financial burden on the income generated to effectively address the daily management of the property and attain a breakeven point as per revival plans
A tree that has just begun to yield fruits must not be allowed to topple in the storms and this is possible when its roots are strengthened
And this is precisely what the promoters should do to save their project from falling prey to situations
*Remember that tourism is vacation and recreation industry and not finance multiplication source
*Investors are humans and will understand the importance of revival, if effectively conveyed and in time
*Promoter's seeking my assistance to revive such ailing projects are most welcome
*Tourism is a key factor to keep our lives rejuvenated and hence properties in this sector must sustain and survive 🌿
