Andres Bonifacio College

School of Business Management Education

College Park, Dipolog City

CASE STUDY: HALINA MOUNTAIN RESORT (A)

Submitted by:
Manuel, Ethelane O.
Quibong, Elleonor G.
Aquino, Andrean T.
Guminta, Mapet D.
Totao, Hannah Jane
Balbosa, Aira Mae
Dywatco, Mile

Submitted to:
Mr. Alejo F. Abule, MBA
Instructor

March 2023
 Blue Heights Realty and Development Corporation
Victor Herrera, chairman of the board of the Blue Heights Realty and
Development Corporation, desired to launch his company’s first big project, a
mineral hot spring resort at Bucal, Calamba, Laguna named Halina Mountain
Resort (A). He wanted to make it as “something he could leave for his family.”
Blue Heights Realty and Development Corporation was organized in October
1976 attached in owning, improving and managing the real estate; it is a
considered a stable company with authorized capital stock of one million pesos
(₱1,000,000) and paid-up capital of nine hundred thousand pesos(₱ 900,000).
The proposed resort was planned to establish to their 2.2 hectare land in Bucal,
Calamba, Laguna. The land was composed of 1.5 hectare Victor inherited from
his father in 1974 and the other seven hundred thousand (700,000) hectare
which he purchased from his commission from commodities trading. Upon the
proposal of the project, Victor asked his son Victor, Jr. to take a survey and
gathered enough data and information about the vicinity and its rival resort. Also,
he made an application with the Ministry of Tourism requesting the approval for
the establishment of the resort stating his reasons for going into the resort trade.
And lastly, he made an application for a ₱ 1,300,000 with Far East Bank and
Trust Company however, there is no assurance if it would recognize the merit of
his proposal, with a complete paper requirement. Herrera strongly believed that
his project is viable and attractive and their reports are unbiased. The only
problem would be the approval of his loan application with the Far East Bank and
Trust Company.

I. Statement of Assumptions

1. Blue Heights Realty and Development Corporation is a Real Estate

developer.
2. Victor Herrera Sr., the chairman of the board of Blue Heights and
Development Corporation has financial problems on establishing his
Company’s first big Project, the Halina Mountain Resort.
3. Blue Heights and Development Corporation’s loan application at Far
East Bank & Trust Company of P1.3 Million is not yet ascertained to be
approved.

II. Statement of the Central Problem

How will Blue Heights Realty and Development Corporation be able to

have enough budget to establish the Halina Mountain Resort?
III. Statement of Objectives

1. Short-range Objectives: To establish a resort that will give customer

satisfaction by means of good services and complete facilities and amenities.

2. Long-range Objectives: To be able to establish a first-class and well-

known mountain resort.
IV. Statement of Facts and Figures

1. Competition
There are twenty-five (25) resorts that surround the place where Halina
Mountain Resort project will be established and most of the resorts of
Calamba offered more or less the same facilities and charged the same
prices.

2. The Creek
A creek from Los Baños going down to Manila Bay which is not
good on the sight of the customer and would leave them worries as it may
cause the land to be soft.

3. Capital
Budget is another problem for they can’t assure that the bank will
grant their loan and even if the bank will grant their loan of ₱1,300,000
(construction of a restaurant and 3 one-bedroom cottages worth ₱
700,000, swimming pools both for adults and children worth ₱350,000,
and purchase of furniture and equipment worth ₱250,000) which is their
estimated cost, there is no assurance that it will meet their actual cost in
establishing the project.

V. Statement of Alternative Courses of Action

1. Blue Heights Realty and Development Corporation would pledge to the

Far East Bank and Trust Company to make an agreement that the land
will stand as collateral for the loan budget that will serve as the capital for
the projected resort.
 2. Mr. Victor E. Herrera, Sr. could borrow budget for establishing the Halina
Mountain Resort to his relatives and friends to sustain the realization of
the project.

3. Mr. Victor E. Herrera, Sr. could propose the project to another

businessman that can be his potential partner for the resort that could help
him finance and established the proposed project.

VI. Statement of Evaluation

 Alternative Course of Action no.1 states that Blue Heights Realty and
Development Corporation would pledge to the Far East Bank and Trust
Company to make an agreement that the land will stand as collateral for
the loan budget that will serve as the capital for the projected resort.

Advantage:
- The bank will allow them to loan the money in exchange of the
land.
- They can have a budget to do the operations of the resort.

Disadvantage:
There will be no assurance that the money they loaned will meet
the actual cost of the resort.

 Alternative Course of Action no.2 states that Mr. Victor E. Herrera, Sr.
could borrow budget for establishing the Halina Mountain Resort to his
relatives and friends to sustain the realization of the project.

Advantage:
- They could borrow the entire amount that they need and the project
would push through.
- They can get the funds with no to low interest and flexible terms of
payment

Disadvantage:
- The possibility of discounts and VIP treatment from those relatives
and friends out of gratitude in the near future that would impact to
lesser income for the resort.
- It can result to friends and relative conflict of interest
  Alternative Course of Action no. 3 states that Mr. Victor E. Herrera, Sr. will
cancel the loan application and could propose the project to another
businessman that can be his potential partner for the resort that could help
him finance and established the proposed project.

Advantage:
A future potential business partnerships would be achieved that
would help them finance the realization of the resort.

Disadvantage:
This will no longer be a family owned business of the involvement
of other person or businessman with said resort.

VII. Statement of Decision and Analysis

After the evaluation and assessment, the group analyst has decided to
choose the best solution to the central problem which is alternative course of
action no. 1 wherein Blue Heights Realty and Development Corporation will
continue the proposal to the Far East Bank and Trust Company and will make an
agreement that the land will stand as collateral for the loan budget. With this
alternative course of action, they can get loan, have sufficient funds, and sustain
all the expenses that will help them and support their full operations in
establishing their resort. If then approved by Far East Bank and Trust Company
their loan application, a project by the Blue Heights Realty and Development
Corporation, Halina Mountain Resort will be the first mineral hot spring resort
which can be reached in Laguna from Manila, envisions surpassing the existing
resorts in point of location, area and the facilities to be constructed thereon.

VIII. Statement of Recommendation

The chief analyst recommends Blue Heights Realty and Development

Corporation to apply for the loan in order to gain enough resources to construct
the resort.

Action Plan:
Exhibit A: Conduct a meeting within the corporation.
Exhibit B: Plan the estimated budget.
Exhibit C: Hire an expert group that will help evaluate the proposal.
Exhibit D: Send a loan application to the Far East Bank and Trust
Company.
Exhibit E: Set a general meeting between Blue Heights Realty and
Development Corporation and to the Far East Bank and Trust
Company.