09/06/2024
GEM Lease Analytics™ SaaS Case Study 1 August 2010: basic prototype of our sophisticated decision-making product which evaluates a Reasonable Rent for ONE Retail Shop: usage Supermarket.
Subject: Privately owned supermarket in country town New South Wales, Australia.
Reason for Submission / Report: Lease option to market rent. Tenant business had had two major supermarket brands introduced into given market. Sales had significantly compressed. Landlord used non-comparable basic ($ per square metre) evidence from urban locations. New sophisticated methods systems processes procedures required to run a contra argument to very experienced Court Appointed Determining Valuer, showing why non-comparable evidence could not be used to support its case.
Outcome achieved: proposed rent fell from $225,000 per annum to $140,000 per annum ($425,000 over 5 years; properly apportioned to Return on Business Assets from unjust enrichment to landlord). Determination in line with significant competition in market.
Business needs $2.125 million additional sales to justify landlord’s proposed (basic analytics) Market Rent.
Other matters: GEM Lease Analytics™ Intellectual Property first showcased to the World in a fully Copyrighted form at the 17th Pacific Rim Real Estate Society Conference: 17 – 19th January 2011, Bond University Mirvac School of Sustainable Development, Holiday Inn, Gold Coast, Queensland, Australia and can be downloaded here https://leaseconsultant.com.au/papers-article/matching-market-demand-to-supply-of-retail-space-via-more-accurate-market-rental-valuations-jan-2011/
Was done not draw too much attention to it, until inventor had had time to evaluate, understand and decide what to do and how to do it with what seemed to be change in evaluating what is a in each given circumstance, for matching to . And how to present it.
As it turns out; SOME P & L INFORMATION MUST BE DISCLOSED for meaningful two-way communication to match Business Capital to Property Capital. It is cleverly designed & presented by us to:
a) NOT DISCLOSE any businesses’ actual P & Ls aka assumes hypothetical leasing or what could be a Business Plan;
b) It uses: “Future Maintainable Sales” for the lease period going forwards aka a judgement call by a thinking fully advised Tenant;
c) It does NOT DISCLOSE all expenses; leaving gaping holes for opportunistic landlords to charge a businesses’ assets into the rent or to incorporate Goodwill (Super Profit) into the rent;
d) Expenses are “scrubbed” to “clean up” a P & L typically used for Tax Reporting Purposes vs presentation required for a Landlord to see that a Tenant is trying to present their case objectively;
e) This aspect of the GEM Method™ forms a SMALL but important part of one’s evaluation of what a Reasonable Rent is for ONE Retail Shop;
f) Ironically Landlords and their Advisors openly circulate Tenant Sales (and Rental Data) even if it is “Engineered” up used for negotiation purposes against Tenants to justify unrealistic rental charging;
g) Tenants and their Lease Negotiators / Advisors ironically have NO CONTRA WAY of arguing their cases;
i) In the event a Landlord needs to be persuaded in the alternative ironically they can still call for the Tenant’s P & Ls for negotiation purposes and justification of same.
The GEM Lease Analytics Method (‘GEM Method’) clearly links reasonable site productivity, to evidence in the market place to assist one to form an opinion of what a Reasonable Rent is.
Since Case Study 1 was presented in January 2011 at an International Conference, whilst the basic methods systems processes (step-by-step) procedures modelling is still in place, both it and its reports / reporting, have been substantially improved and fine-tuned. The Copyrighted Intellectual Property built into it can be traced back to the Inventors First Paper in 1993 to 2024 which he traces back to 1523.
Our Internationally Scalable (on Platform & Servers) Fully Copyrighted GEM Lease Analytics™ SaaS is “For Sale” for $30,000,000 USD. We are NOT building a business. GEM will end up on: Mapping. If Microsoft acquired for $29.0 billion; GEM Lease Analytics™ is worth more than that.
What used to take the Inventor 2.0 – 4.0 weeks work as an independent expert, to Determine Current Market Rent, has been compressed into est 1 ½ hrs key data input time and is marketed as a Decision-Making product.
Talk to Arnold at ABS, Brisbane.
More Case Studies to follow. Some basic business math(s) will be done to indicate revenue opportunity.
© Copyright Donald Evan Gilbert / Gilbert Family Pty Ltd as Trustee for Gilbert Family Trust
DG 10/6/2024
