2.2.1 - start-up capital assumptions westbury storage proposal assumptions about needed assets...

2.2.1 - START-UP CAPITAL ASSUMPTIONSWESTBURY STORAGE PROPOSAL

ASSUMPTIONS ABOUT NEEDED ASSETS (capital items)

We will offer by June 1 of year 0 to purchase the building at 1400 Commercial Drive, in Westbury, New York. This is a 3 floor 60,000 sq ft warehouse in a commercially-zoned area. We must take possession of the property by July 1, so that studies of how to renovate the property can be made. Payment in full for the purchase is expected by August 15. Price = $567,430.

A contractor will begin to create an office and 388 storage units on the three floors inside the building, beginning on August 15. The office should be finished by October 15, and all storage units will be completed by December 15. An initial payment of $100,000 is due in August, with $50,000 to be paid each consecutive month until the job is complete. Total cost = $308,000.

Elevator refurbishment and upgrading will begin on September 15, and should be completed by November 15. The provider expects payment of $30,000 each month, beginning in September, with the ending balance due in November. Total cost = $92,000

Office furnishings and equipment will be purchased and installed by November 15. Total cost = $10,650

Equipment to assist customers in moving and storing goods (hand trucks, dray wagons, and locks) will be purchased and delivered by December 15. Total cost = $3,400

START-UP CAPITAL INVESTMENTSWESTBURY STORAGE PROPOSAL

BUILDING $967,430

Building purchase (includes closing costs) $567,430

Renovation and construction (units and office) $308,000

Elevators refurbished $ 92,000

OPERATING EQUIPMENT $ 3,400

Hand trucks (6 @ $125 / assorted sizes) $ 750

Dray wagons (3 @ $450 / with large wheels) $ 1,050

Red locks for unit security (400 @ $4) $ 1,600

OFFICE EQUIPMENT $ 10,650Desks and chairs (3 sets @ $1100) $ 3,300

Chairs, side and waiting (3 @ $250 + 4 @ $300) $ 1,950

File cabinets (3 @ $600) $ 1,800

End tables and coffee table (2 @ $75 + $250) $ 400

Computers and printers (2 @ $1000) $ 2,000

Photocopier/Scanner/Fax Machine $ 500

Furnishings (Drapes, etc) $ 700

TOTAL START UP ASSETS NEEDED $981,480

2.2.2 - START-UP EXPENSE ASSUMPTIONS - 1

We plan to contact a lawyer to assist us in filing for limited liability corporation status (LLC). This needs to happen in early June (year 0). We expect all expenses (lawyer plus filing fees) to cost about $3000. The lawyer must be paid by July 1.

Property and liability insurance must be purchased as of July 1, year 0. Six months of coverage for July 1 to December 31 will cost about $5000. Once operations begin in year 1, property and liability insurance will cost $18000 per year, and must be paid (half) in January and July of each year. Insurance costs are expected to increase an additional 3% each year starting with year 2.

Property taxes for July to December (year 0) are $5975, and are payable in December. Once the facility opens (in year 1), property taxes are expected to be $25000 per year, and will increase about 3% per year thereafter.

As of July 1, year 0, utility expenses average $880 per month (water and sewer charges are $360/yr, electricity is $3000/yr, trash removal is $1200/yr, and heating expense is expected to be 6000/yr). Thus total utilities costs are $10560 per year, and are not expected to change when we begin full operations in year 1. Beginning in year 2, we project that utilities costs will increase about 3% annually.

Telephone service will cost $90 per month. Currently there is no phone service in the building, but it will be installed once the office is occupied on November 1 (year 0). Starting in year 2, we expect phone costs to increase about 3% per year.

START-UP EXPENSE ASSUMPTIONS - 2

We will begin to advertise in December of year 0. We plan to advertise annually in the yellow pages ($900 per year, renewable in December) and monthly in local newspapers ($300/month). We will stop newspaper ads at the end of year 1. Yellow page ads will be placed each year, and costs are assumed to increase about 3% per year beginning in year 2.

When we set up our office, starting in November (year 0), we must purchase an accounting software package (like QuickBooks) and office supplies (envelopes, paper, stamps, forms, files, etc). We have allocated $800 for these initial purchases. Once operations begin, there will be an ongoing need for periodic purchases of envelopes, paper, forms, files, stamps, etc. We anticipate these costs to be $1000 in year 1, $2000 in year 2, and an annual increase of about 5% each year thereafter. Normally, these items will be replenished in November of each year.

Two employees will staff the facility: a manager and an office assistant. The assistant will not be hired until the facility opens in January 1 (year 1). The manager will be employed on July 1 (year 0), and will oversee the preparation and development of the facility as it is renovated. He will be paid a salary of $30,000 per year with additional benefit costs of $9000 (30% of wages). Thus, labor costs for the period July 1 to December 31 (year 0) are expected to be $19,500 or $3250 per month. Once operations begin, the assistant will be hired with expected annual wages of $20800, and an additional $6240 (30%) for benefits. Starting with year 2, we anticipate labor costs (salaries plus benefit expenses) will increase an average of 6% per year.

No maintenance expenses will be incurred in year 0. Maintenance expenses are expected to be $18,000 in year 1. This is normally charged out on a monthly basis. We expect maintenance costs to increase 6% each year, starting in year 2.

2.2.3 - ASSUMPTIONS ABOUT DEPRECIATION AND UTILIZATION

ASSUMPTIONS ABOUT DEPRECIATION

Depreciation for equipment will be calculated on a straight-line basis, and allocated over five years. Thus, the annual equipment depreciation charge will be $2810 ($14,050/5 = $2810), beginning in year 1 and ending in year 5.

Building depreciation will be calculated on a straight-line basis, and allocated over forty years. Thus, $24186 of building depreciation will be charged against annual operations ($967,430/40 = $24186), beginning in year 1, and ending in year 40.

UTILIZATION/OCCUPANCY ASSUMPTIONSOur three sales forecasts make the following assumptions about utilization or occupancy in years 1, 2

and beyond:Year 1 Year 2 Years 3+

Optimistic 60% 100% 100%Most Likely 50% 95% 95%Pessimistic: 35% 70% 70%

All three scenarios assume upper floor rates will gradually be raised in years 2 and 3 to match the rates charged for first floor renters (see next chart). Furthermore, we have assumed that rates will rise by roughly 4 - 5% per year, beginning in year 4. These rate increases for years 4-7 are assumed for both the optimistic and most likely scenarios. The pessimistic scenario assumes that heavy competition will force us to not raise rates in year 4. Modest 2% rate increases are assumed for years 5-7.

2.3 - INITIAL FUNDING SOURCESWESTBURY STORAGE PROPOSAL

START UP ASSUMPTIONS ABOUT EQUITY AND DEBT (and timeline):

We do not expect to turn a profit or break-even until year 2. Initial investment costs and operating expenses are large, and will badly deplete cash in the start up phase and in the initial year of operation. Thus, we need significant equity funding from the owners, as well as favorable terms from those lending institutions who are comfortable with us. Once we achieve full occupancy, the full profit potential of this venture will be realized.

The owners must contribute at least $400000 of equity to capitalize this venture. Cash flow projections have revealed that this amount is needed to keep sufficient working capital in the firm during the first year and a half of operation. Thus, no equity or capital should be removed from this venture by the owners for at least two years. Initial investment of $400,000 will be used to establish a checking account on June 1-yr 0.

We plan to obtain a fixed-rate mortgage to fund the purchase and renovation of the building. The bank will finance 70% of our investment in the building (which will be $967,430), and will give us a 40-year, fixed-rate loan at 8%. Thus the loan will be for $677,200, and the proceeds will be available to us at the closing in August (year 0). Monthly loan payments of $5580 will begin in October (year 0).

We have negotiated a short-term 8% (one-year) loan with an equipment supplier to help purchase our office equipment. We will receive the $8000 loan in November, when we take delivery of the office equipment. Loan payments of $696 are due each month, starting the end of November (year 0), and ending with the October (year 1) payment.

2.4 - LOCATION AND FACILITIESWESTBURY STORAGE PROPOSAL

THE FACILITYASSUMPTIONS ABOUT THE PROPOSED FACILITY:

We plan to renovate a 3-story building, 241 ft x 81 feet (inside dimensions) About 6200 sq ft will be used for walkways, elevators, etc. on each floorAn office and storage spaces will occupy 1300 sq ft on the first floorPartitions and walls will take up between 1500-1800 sq ft on each floorThis leaves us roughly 10500-12000 sq ft of rentable floor space per floor 388 storage units will be constructed on the three floors as noted below:

NUMBER AND TYPE OF STORAGE UNITS TO BE BUILT ON EACH FLOOR

Sq Ft / Unit 1st Floor 2nd Floor 3rd Floor TOTAL25 (5x5) -0- 21 units 21 units 42

units50 (5x10) 43 units 43 units 36 units 122 units100 (10x10) 51 units 41 units 44 units 136 units150 (10x15) 22 units 33 units 33 units 88 units

See Floor Plans that follow: TOTAL 388 units

3.1 – SERVICE ASSUMPTIONSWESTBURY STORAGE PROPOSAL

We intend to offer the four most popular sizes of storage units: 5x5, 5x10, 10x10 and 10x15.

These units will be located on all three floors of our building.

We are installing a high-speed elevator with extra large capacity to transport patrons and their goods to the 2nd and 3rd floors.

We will provide (free of charge) several large, easy-to-roll dollies and dray wagons to help customers transport their goods between the docking area and their storage units.

3.3 – COMPETITOR RESEARCH WESTBURY STORAGE PROPOSAL

11 Competitors in the area…what size storage units does each offer?...and at what price?

Name Size Sq Ft Price/Mo Oliver St. Mini Storage 5X10 50 $48

“ 10X10 100 $75E_Z Mini Storage 5X5 25 $37S. Centreport 5X10 50 $67 +$25 depExtra Space Storage 5X5 25 $49 + $9 fee

“ 10X10 100 $106 (2nd floor)“ 10X10 100 $139 (ground floor)

Washington Mini-Storage 8X6 48 $5047 State Street Storage 9X9 81 $50 (2nd floor)Public Storage 5X5 25 $35Pack Rat Self-Storage 5X10 50 $55

“ 10X10 100 $95“ 10X15 150 $129“ 10X20 200 $147

North Shore Self-Storage 5X5 25 $45 + $5 feeWillie's Storage 5X10 50 $70 (2nd floor)

“ 10X15 150 $130U-Haul Self-Storage 5X10 50 $42.95

“ 10X10 100 $95

COMPETITOR RESEARCH SUMMARY

COMPETITOR SUMMARYBY TYPE OF UNITS RENTED

# Facilities that offer… Price/Mo Sq Ft Mo Rev/Sq Ft

4 (5x5) $45 25 $1.806 (5x10) $55.50 48-50 $1.111 (9x9) $50 75-81 $0.61735 (10x10) $102 100 $1.022 (10x15) $129.50 150 $0.86331 (10x20) $147 200 $0.735

Most of these competitors were fully rented out (95%+ occupied) with very few available units.

Thus, we assume that we should be able to attain a high occupancy rate once we are known in the community…further assuming we charge “reasonable” or going rates for our storage services.

3.4 - MARKET DEMAND ASSUMPTIONSWESTBURY STORAGE PROPOSAL

Occupancy rates among competitor storage facilities are currently between 90% and 100%. Several of these businesses didn’t have any spaces available…they were fully rented when we were gathering price information. This bodes well for our business, since we shouldn’t have much trouble keeping our units fully rented once the public becomes aware of our new facility. Thus, we assume (…our most likely scenario) that during the first year of operation, our occupancy rate will average about 50%. By the end of the first year (…or at the beginning of year 2), we will have achieved about a 95% utilization/occupancy rate which we should be able to maintain.

For forecasting purposes, we have made the following assumptions about the average utilization or occupancy rates in years 1, 2 and beyond:

Year 1 Year 2 Years 3+Optimistic 60% 100% 100%Most Likely 50% 95% 95%Pessimistic: 35% 70% 70%

All three scenarios assume that upper floor rates will gradually be raised in years 2 and 3 to match the rates charged for first floor renters (see next chart).

In the optimistic and most likely scenarios, we assume that rental rates will rise by 4 - 5% each year, beginning in year 4.

The pessimistic scenario assumes no rate increase in year 4 because of increased competition. A modest rate increase of 2% per year is projected for years 5, 6, and 7.

3.5 - PRICING ASSUMPTIONSWESTBURY STORAGE PROPOSAL

• We need to keep our prices competitive for the first year if we want to fill up our facility. (See 3.3 Competitor Summary)

• We will charge $10 more per month for our first floor storage units because of convenience…but prices on floors 2 and 3 will match the competition.

• Except for the (5x5) units, we will gradually raise our unit rates on the upper floors by $5 per month in year 2, and again in year 3, so that rental rates will be the same for all floors by year 3.

Size of Rental Unit Avg Compet Price/Mo Our Price/Mo – Yr 1

1st Floor 2nd/3rd Floor

(5x5) 25SQ FT $45 ---- $ 45

(5x10) 50SQ FT $55.50 $ 65 $ 55

(10x10) 100SQ FT $102 $110 $100

(10x15) 150SQ FT $129.50 $140 $130

3.5.1 – SEVEN YEAR PRICING PLANOPTIMISTIC & MOST LIKELY SCENARIOS

Unit Size Price/Mo - Yr 1 Price/Mo – Yr 2 Price/Mo - Yr 3

1st Floor 2nd/3rd Flr 1st Floor 2nd/3rd Flr 1st Floor 2nd/3rd Flr

(5x5) ---- $ 45 ---- $ 45 ---- $ 45(5x10) $ 65 $ 55 $ 65 $ 60 $ 65 $ 65(10x10) $110 $100 $110 $105 $110 $110(10x15) $140 $130 $140 $135 $140 $140

Starting in Year 4, rates will be raised an additional 4% - 5% each year.

Unit Size Year 4 Year 5 Year 6 Year 7 (5x5) $47/mo $49/mo $51/mo $53/mo(5x10) $68/mo $71/mo $74/mo $77/mo(10x10) $115/mo $120/mo $125/mo $130/mo(10x15) $147/mo $154/mo $162/mo $170/mo

3.5.2 – SEVEN YEAR PRICING PLANPESSIMISTIC SCENARIO

Unit Size Price/Mo - Yr 1 Price/Mo – Yr 2 Price/Mo - Yr 3

1st Floor 2nd/3rd Flr 1st Floor 2nd/3rd Flr 1st Floor 2nd/3rd Flr

(5x5) ---- $ 45 ---- $ 45 ---- $ 45(5x10) $ 65 $ 55 $ 65 $ 60 $ 65 $ 65(10x10) $110 $100 $110 $105 $110 $110(10x15) $140 $130 $140 $135 $140 $140

No change in rates for Year 4…Rates increase roughly 2% in Years 5-7.

Unit Size Year 4 Year 5 Year 6 Year 7 (5x5) $45/mo $46/mo $47/mo $48/mo(5x10) $65/mo $66/mo $67/mo $68/mo(10x10) $110/mo $112/mo $114/mo $116/mo(10x15) $140/mo $143/mo $146/mo $149/mo

3.6.1 - MONTHLY REVENUE FORECASTSOPTIMISTIC & MOST LIKELY SCENARIOS

Revenues per Month if 100% Occupied

Unit Size # Units Year 1 Year 2 Year 3(5x5) 42 $1890 $1890 $1890

(5x10) 122 $7140 $7535 $7930

(10x10) 136 $14110 $14535 $14960

(10x15) 88 $11660 $11990 $12320

Revenue/Mo (…if 100% rented) $34800 $35950 $37100

Year Year 4 Year 5 Year 6 Year 7 (5x5) $1974 $2058 $2142 $2226

(5x10) $8296 $8662 $9028 $9394

(10x10) $15640 $16320 $17000 $17680

(10x15) $12936 $13552 $14256 $14960

Revenue/Mo $38846 $40592 $42426 $44260

THE ABOVE PROJECTIONS FOR YEARS 4-7 ASSUME RATES GO UP ROUGHLY 4-5% EACH YEAR

3.6.2 - MONTHLY REVENUE FORECASTSPESSIMISTIC SCENARIO

Revenues Generated per Month if 100% Occupied

Unit Size # Units Year 1 Year 2 Year 3(5x5) 42 $1890 $1890 $1890

(5x10) 122 $7140 $7535 $7930

(10x10) 136 $14110 $14535 $14960

(10x15) 88 $11660 $11990 $12320

Revenue/Mo (…if 100% rented) $34800 $35950 $37100

Year Year 4 Year 5 Year 6 Year 7 (5x5) $1890 $1932 $1974 $2016

(5x10) $7930 $8052 $8174 $8296

(10x10) $14960 $15232 $15504 $15776

(10x15) $12320 $12584 $12848 $13112

Revenue/Mo $37100 $37800 $38500 $39200

PROJECTIONS FOR THE PESSIMISTIC SCENARIO FOR YEARS 4-7 (NO INCREASE IN YEAR 4, AND JUST A 2% INCREASE IN YEARS 5-7)

3.7.1 – PESSIMISTIC SALES FORECASTS FOR 7 YEARS

PESSIMISTIC SALES FORECAST:

Revenue projections for the first year of operation are based on an average occupancy of just 35%. All other projections (year 2 and onward) assume that only 70% of the spaces will be rented. Rental rates will not be increased in year 4 due to competitive pressures, but rates will increase 2 % in years 5-7.

PESSIMISTIC REVENUE PROJECTIONSYEAR 1 YEAR 2 YEAR 3

Utilization = .35 Utilization = .70 Utilization = .70

Total Revenue/Month $12180 $25165 $25970

Annual Revenues $146160 $301980 $311640

YEAR 4 YEAR 5 YEAR 6 YEAR 7

Utilization = .70 Utilization = .70 Utilization = .70 Utilization = .70

Mo $25970 $26460 $26950 $27440

Annual $311640 $317520 $323400 $329280

3.7.2 – MOST LIKELY SALES FORECASTS FOR 7 YEARS

MOST LIKELY SALES FORECAST:

Revenue projections for the first year of operation are based on an average occupancy of just 50%. All other projections (year 2 and onward) assume that 95% of the spaces will be rented.

MOST LIKELY REVENUE PROJECTIONSYEAR 1 YEAR 2 YEAR 3

Utilization = .50 Utilization = .95 Utilization = .95

Total Revenue/Month $17400 $34152.50 $35245

Annual Revenues $208800 $409830 $422940


Utilization = .95 Utilization = .95 Utilization = .95 Utilization = .95

Mo $36903.70 $38562.40 $40304.70 $42047

Annual $442844 $462749 $483656 $504564

3.7.3 - OPTIMISTIC SALES FORECASTS FOR 7 YEARS

OPTIMISTIC SALES FORECAST:

Revenue projections for the first year of operation are based on an average occupancy of just 60%. All other projections (year 2 and onward) assume that 100% of the spaces will be rented.

OPTIISTIC REVENUE PROJECTIONSYEAR 1 YEAR 2 YEAR 3

Utilization = .60 Utilization = 1.00 Utilization = 1.00

Total Revenue/Month $20880 $35950 $37100

Annual Revenues $250560 $431400 $445200


Utilization = 1.00 Utilization = 1.00 Utilization = 1.00 Utilization = 1.00

Mo $38846 $40592 $42426 $44260

Annual $466152 $487104 $509112 $531120

5.2.1 – PESSIMISTIC INCOME STATEMENTS FOR YEARS 0 - 7

Income Stmts Yr 0* Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

INCOME -0- 146160 301980 311640 311640 317520 323400 329280 Operating ExpensesLabor + Benefits 19500 66000 69960 74158 78607 83323 88322 93621Legal/Office Supp 3800 1000 2000 2100 2205 2315 2431 2553Insurance 5000 18000 18540 19652 20242 20849 21474 22118Prop Taxes 5975 25000 25750 26523 27319 28139 28983 29852Utilities + Phone 5460 11640 11989 12348 12718 13100 13493 13898Advertising 1200 4500 927 955 984 1014 1044 1075Maintenance -0- 18000 19080 20225 21439 22725 24089 25534Total Expenses 40935 144140 148246 155961 163514 171465 179836 188651EBITDA (40935) 2020 153734 155679 148126 146055 143564 140629

Depreciation -0- 26996 26996 26996 26996 26996 24186 24186Operating Income (40935) (24976) 126738 128683 121130 119059 119378 116443Short-term Note Int 104 248 -0-Mortgage Interest 13522 53490 52458 51426 50394 49362 48330 47298Total Interest Exp 13626 53738 52458 51426 50394 49362 48330 47298Earnings before Tax (54561) (78714) 74280 77257 70736 69697 71048 69145Income Taxes (0%) -0- -0- -0- -0- -0- -0- -0- -0-

NET INCOME (54561) (78714) 74280 77257 70736 69697 71048 69145

5.2.2 – MOST LIKELY INCOME STATEMENTS FOR YEARS 0 - 7



Depreciation -0- 26996 26996 26996 26996 26996 24186 24186Operating Income (40935) 37664 234588 239983 252334 264288 279634 291727Short-term Note Int 104 248 -0-Mortgage Interest 13522 53490 52458 51426 50394 49362 48330 47298Total Interest Exp 13626 53738 52458 51426 50394 49362 48330 47298Earnings before Tax (54561) (16074) 182130 188557 201940 214926 231304 244429Income Taxes (0%) -0- -0- -0- -0- -0- -0- -0- -0-

NET INCOME (54561) (16074) 182130 188557 201940 214926 231304 244429

5.2.3 - OPTIMISTIC INCOME STATEMENTS FOR YEARS 0 - 7



Depreciation -0- 26996 26996 26996 26996 26996 24186 24186Operating Income (40935) 79424 256158 262243 275642 288643 305090 318283Short-term Note Int 104 248 -0-Mortgage Interest 13522 53490 52458 51426 50394 49362 48330 47298Total Interest Exp 13626 53738 52458 51426 50394 49362 48330 47298Earnings before Tax (54561) 25686 203700 210817 225248 239281 256760 270985Income Taxes (0%) -0- -0- -0- -0- -0- -0- -0- -0-

NET INCOME (54561) 25686 203700 210817 225248 239281 256760 270985

5.3.1 - PESSIMISTIC BALANCE SHEETS FOR YEARS 0 - 7

Balance Sheets Yr 0* Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

Cash 44653 (27247)* 59527 148246 229412 308507 385111 458780

Equipment 14050 14050 14050 14050 14050 14050 14050 14050 Accum Deprec (2810) (5620) (8430) (11240) (14050) (14050) (14050)

Building 967430 967430 967430 967430 967430 967430 967430 967430 Accum Deprec (24186) (48372) (72558) (96744) (120930) (145116) (169302)Net Fixed Assets 981480 954484 927488 900492 873496 846500 822314 798128

TOTAL ASSETS 1026133 927237 987015 1048738 1102908 1155007 1207425 1256908

Short-term Note 6712 -----Current Mtge Pmts 13470 14502 15534 16566 17598 18630 19662 20694

Long-term Mortgage 660512 646010 630476 613910 596312 577682 558020 537326Total Liabilities 680694 660512 646010 630476 613910 596312 577682 558020

Paid-in Capital 400000 400000 400000 400000 400000 400000 400000 400000Loss at Start up (54561) (54561)Retained Earnings (78714) (58995) 18262 88998 158695 229743 298888Total Equity 345439 266725 341005 418262 488998 558695 629743 698888

TOT DEBT+EQTY 1026133 927237 987015 1048738 1102908 1155007 1207425 1256908

5.3.2 - MOST LIKELY BALANCE SHEETS FOR YEARS 0 - 7


Cash 44653 35393 230017 430036 642406 866730 1103590 1352543



TOTAL ASSETS 1026133 989877 1157505 1330528 1515902 1713230 1925904 2150671

Short-term Note 6712 -----Current Mtge Pmts 13470 14502 15534 16566 17598 18630 19662 20694


Paid-in Capital 400000 400000 400000 400000 400000 400000 400000 400000Loss at Start up (54561) (54561)Retained Earnings (16074) 111495 300052 501992 716918 948222 1192651Total Equity 345439 329365 511495 700052 901992 1116918 1348222 1592651

TOT DEBT+EQTY 1026133 989877 1157505 1330528 1515902 1713230 1925904 2150671

5.3.3 - OPTIMISTIC BALANCE SHEETSFOR YEARS 0 - 7


Cash 44653 77153 293347 515626 751304 999983 1262299 1537808



TOTAL ASSETS 1026133 1031637 1220835 1416118 1624800 1846483 2084613 2335936 Short-term Note 6712 -----Current Mtge Pmts 13470 14502 15534 16566 17598 18630 19662 20694


Paid-in Capital 400000 400000 400000 400000 400000 400000 400000 400000Loss at Start up (54561) (54561)Retained Earnings 25686 174825 385642 610890 850171 1106931 1377916Total Equity 345439 371125 574825 785642 1010890 1250171 1506931 1777916

TOT DEBT+EQTY 1026133 1031637 1220835 1416118 1624800 1846483 2084613 2335936

5.4.0 - MONTHLY CASH-FLOWS FOR YEAR 0 (June 1 – Dec 31) ALL SCENARIOS

Cash Flows June July Aug Sep Oct Nov Dec TOTAL

BEGIN CASH -0- 400000 387870 393510 309380 219670 123724

Add Stock sales 400000 400000Add Loans 677200 8000 685200

Start up AssetsBuilding 567430 567430Construction 100000 50000 50000 50000 58000 308000Elevators 30000 30000 32000 92000Equipment 10650 3400 14050Less Capital Assets 667430 80000 80000 92650 61400 981480

Operating ExpensesLabor 3250 3250 3250 3250 3250 3250 19500Legal+Office Exp 3000 800 3800Insurance + PrTax 5000 5975 10975Utilities + Phone 880 880 880 880 970 970 5460Advertisement 1200 1200ST Note Pmts 696 696 1392LT Mtge Pmts 5580 5580 5580 16740Less Operating Exp 12130 4130 4130 9710 11296 17671 59067

END CASH 400000 387870 393510 309380 219670 123724 44653 44653

5.4.1 - WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 1 (January 1 – June 30) PESSIMISTIC

Year 1A - Cash Jan Feb Mar Apr May Jun

BEGIN CASH 44653 22981 12183 3259 (3791)* (8967)*

Less Operating Expenses

Labor + Benefits 5500 5500 5500 5500 5500 5500

Office Supplies

Insurance 9000

Property Taxes

Utilities + Phone 970 970 970 970 970 970

Advertisement 300 300 300 300 300 300

Maintenance 1500 1500 1500 1500 1500 1500

Less Operating Expenses 17270 8270 8270 8270 8270 8270

ST Note Payments 696 696 696 696 696 696

Mortgage Payments 5580 5580 5580 5580 5580 5580

Less Debt Repaid (P+I) 6276 6276 6276 6276 6276 6276

Add Monthly Receipts 1874 3748 5622 7496 9370 11244

END CASH 22981 12183 3259 (3791)* (8967)* (12269)*

WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 1 (July 1 – Dec 31) PESSIMISTIC

Year 1B - Cash July Aug Sep Oct Nov Dec

BEGIN CASH (12269) (22697) (22251) (19931) (15737) (9973)


Labor + Benefits 5500 5500 5500 5500 5500 5500

Office Supplies 1000

Insurance 9000

Property Taxes 25000

Utilities + Phone 970 970 970 970 970 970

Advertisement 300 300 300 300 300 1200

Maintenance 1500 1500 1500 1500 1500 1500


ST Note Payments 696 696 696 696




END CASH (22697) (22251) (19931) (15737) (9973) (27247)

WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 2 (January 1 – June 30) PESSIMISTIC


BEGIN CASH (27247)* (25351) (14185) (3019) 8147 19313


Labor + Benefits 5830 5830 5830 5830 5830 5830

Office Supplies

Insurance 9270

Property Taxes

Utilities + Phone 999 999 999 999 999 999

Advertisement

Maintenance 1590 1590 1590 1590 1590 1590


ST Note Payments




END CASH (25351) (14185) (3019) 8147 19313 30479

WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 2 (July 1 – Dec 31) PESSIMISTIC

Year 2B - Cash Jul Aug Sep Oct Nov Dec

BEGIN CASH 30479 32375 43541 54707 65873 75039Less Operating ExpensesLabor + Benefits 5830 5830 5830 5830 5830 5830Office Supplies 2000Insurance 9270Property Taxes 25750Utilities + Phone 999 999 999 999 999 999Advertisement 927Maintenance 1590 1590 1590 1590 1590 1590Less Operating Expenses 17689 8419 8419 8419 10419 35096

Less Mortgage Payments 5580 5580 5580 5580 5580 5580 Less Debt Repaid (P+I) 5580 5580 5580 5580 5580 5580


END CASH 32375 43541 54707 65873 75039 59528

5.4.1.1 - WESTBURY STORAGEPESSIMISTIC CASH FLOW PROJECTIONS FOR YEARS 1 - 7

Cash Flow Projection Yr 0* Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

BEGIN CASH -0- 44653 (27247)* 59527 148246 229412 308507 385111

Add Oper Income (40935) (24976) 126738 128683 121130 119059 119378 116443

Add Depreciation -0- 26996 26996 26996 26996 26996 24186 24186

Less Income Taxes -0- -0-

Operating Adjust (40935) 2020 153734 155679 148126 146055 143564 140629

Add Stock Sales 400000 -0-

Add Loan Proceeds 685200 -0-

Less Acquired Assets 981480 -0-

Less Payments (I+P)

Interest 13626 53738 52458 51426 50394 49362 48330 47298

Principal Pmts 4506 20182 14502 15534 16566 17598 18630 19662

END CASH 44653 (27247)* 59527 148246 229412 308507 385111 458780

5.4.2 - WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 1 (January 1 – June 30) MOST LIKELY


BEGIN CASH 44653 23784 14592 8077 4239 3078


Labor + Benefits 5500 5500 5500 5500 5500 5500

Office Supplies

Insurance 9000

Property Taxes

Utilities + Phone 970 970 970 970 970 970

Advertisement 300 300 300 300 300 300

Maintenance 1500 1500 1500 1500 1500 1500


ST Note Payments 696 696 696 696 696 696




END CASH 23784 14592 8077 4239 3078 4594

WESTBURY STORAGEMONTHLY CASH-FLOWS FOR YEAR 1 (July 1 – Dec 31) MOST LIKELY

Year 1B - Cash July Aug Sep Oct Nov Dec

BEGIN CASH 4594 (213) 6657 16204 28428 43025


Labor + Benefits 5500 5500 5500 5500 5500 5500

Office Supplies 1000

Insurance 9000

Property Taxes 25000

Utilities + Phone 970 970 970 970 970 970

Advertisement 300 300 300 300 300 1200

Maintenance 1500 1500 1500 1500 1500 1500


ST Note Payments 696 696 696 696




END CASH (213) 6657 16204 28428 43025 35393

5.4.2.1 - WESTBURY STORAGEMOST LIKELY CASH FLOW PROJECTIONS FOR YEARS 1 - 7


BEGIN CASH -0- 44653 35393 230017 430036 642406 866730 1103590

Add Oper Income (40935) 37664 234588 239983 252334 264288 279634 291727


Less Income Taxes -0- -0-





Less Payments (I+P)

Interest 13626 53738 52458 51426 50394 49362 48330 47298

Principal Pmts 4506 20181 14502 15534 16566 17598 18630 19662

END CASH 44653 35393 230017 430036 642406 866730 1103590 1352543

5.4.3.1. - WESTBURY STORAGEOPTIMISTIC CASH FLOW PROJECTIONS FOR YEARS 1 - 7


BEGIN CASH -0- 44653 77153 293347 515626 751304 999983 1262299

Add Oper Income (40935) 79424 256158 262243 275642 288643 305090 318283


Less Income Taxes -0-





Less Payments (I+P)

Interest 13626 53738 52458 51426 50394 49362 48330 47298

Principal Pmts 4506 20181 14502 15534 16566 17598 18630 19662

END CASH 44653 77153 293347 515626 751304 999983 1262299 1537808

5.5 - WESTBURY STORAGEPROFITABILITY RATIOS FOR YEARS 1 –7 UNDER 3 MARKET SCENARIOS

Yr 0* Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

OPTIMISTICReturn on Assets (.040) .077 .210 .185 .170 .156 .146 .136Return on Equity (.158) .069 .354 .268 .223 .191 .170 .152Net Profit Margin ----- .103 .472 .474 .483 .491 .504 .510

MOST LIKELYReturn on Assets (.040) .038 .203 .180 .166 .154 .145 .136Return on Equity (.158) (.049) .356 .269 .224 .192 .172 .153Net Profit Margin ----- (.077) .444 .446 .456 .464 .478 .484

PESSIMISTICReturn on Assets (.040) (.027) .128 .123 .110 .103 .099 .093Return on Equity (.158) (.295) .218 .184 .145 .125 .113 .099Net Profit Margin ----- (.539) .246 .248 .227 .220 .220 .210

ROA = Operating Income/Total AssetsROE = Net Income/Total EquityNPM = Net Income/Total Sales

WESTBURY STORAGELIQUIDITY RATIOS FOR YEARS 1 –7 UNDER 3 MARKET SCENARIOS


OPTIMISTICCurrent Ratio 2.213 5.320 18.88 31.13 42.69 53.68 64.20 74.31

Quick (Acid Test)

MOST LIKELYCurrent Ratio 2.213 2.441 14.81 25.96 36.50 46.52 56.13 65.36

Quick (Acid Test)

PESSIMISTICCurrent Ratio 2.213 (1.879) 3.832 8.949 13.04 16.56 19.59 22.17

Quick (Acid Test)

Current Ratio = Current Assets/Current Liabilities

Quick Ratio = (Current Assets – Inventories)/Current Liabilities

WESTBURY STORAGELEVERAGE RATIOS FOR YEARS 1 –7 UNDER 3 MARKET SCENARIOS


OPTIMISTICDebt to Assets Ratio .663 .640 .529 .445 .378 .323 .277 .239

Debt to Equity Ratio 1.971 1.780 1.124 .802 .607 .477 .383 .314

Times Interest Earned (3.00) 1.478 4.883 5.099 5.470 5.847 6.313 6.729

MOST LIKELYDebt to Assets Ratio .663 .667 .558 .474 .405 .348 .300 .259

Debt to Equity Ratio 1.971 2.005 1.263 .901 .681 .534 .428 .350

Times Interest Earned (3.00) .701 4.472 4.667 5.007 5.354 5.786 6.168

PESSIMISTICDebt to Assets Ratio .663 .712 .655 .601 .557 .516 .478 .444

Debt to Equity Ratio 1.971 2.476 1.894 1.507 1.255 1.067 .917 .798

Times Interest Earned (3.00) (.465) 2.416 2.502 2.404 2.412 2.470 2.462

Debt to Assets Ratio = Total Liabilities / Total Assets

Debt to Equity Ratio = Total Liabilities / Total Equity

Times Interest Earned Ratio = Operating Income / Interest Expense

WESTBURY STORAGEACTIVITY RATIOS FOR YEARS 1 –7 UNDER 3 MARKET SCENARIOS


OPTIMISTICWorking Cap Turn -----

Working Capital % ----- .250 .644 1.12 1.57 2.01 2.44 2.86

Asset Turnover ----- .243 .353 .314 .289 .264 .244 .227

MOST LIKELYWorking Cap Turn -----

Working Capital % ----- .100 .523 .978 1.41 1.83 2.24 2.64

Asset Turnover ----- .211 .354 .318 .292 .270 .251 .235

PESSIMISTICWorking Cap Turn -----

Working Capital % ----- (-.286) .146 .423 .680 .913 1.13 1.33

Asset Turnover ----- (.158) .306 .297 .270 .275 .268 .262

Accounts Receivable Turnover = Credit Sales/Accounts Receivable

Average Collection Period = (Accounts Receivable x 365)/Total Sales

Inventory Turnover = COGS/Finished Goods Inventory

Working Capital Turnover = Net Sales/(Current Assets – Current Liabilities)

Working Capital Percentage = (Current Assets – Current Liabilities)/Net Sales

Asset Turnover = Net Sales/Total Assets

2.2.1 - start-up capital assumptions westbury storage proposal assumptions about needed assets...

Documents

total cost

office equipment

property taxes

storage units

office furnishings

total utilities costs

building purchase

insurance costs