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Microcap & Penny Stocks : TNRG Tianrong Building Materials -- Ignore unavailable to you. Want to Upgrade?

To: Sigmund who wrote (2702)	6/29/1998 2:45:00 AM
From: ISOMAN	Read Replies (2) \| Respond to of 9824

Are you serious??? Are you really unaware of all of this, or is this just some game to cause uncertainty? I'm going to give you the benefit of the doubt and treat you like a person new to the TNRG scene and these are innocent questions on your part. First a cap rate is the amount paid divided by the net rents. It is not the R.O.I. A capitilzation rate is used by appraisers to assess the value of similar properties. I can't tell you the cap rate of a property in Chungking. I only know the cap rates in my city. Cap rates have nothing to do with cash. The only time you look at a cap rate is to see if the purchase price is realistic. In this case the cap rate is 9.6. I have a house I bought for 80,000. I rent it for 800 a month. After expenses I am left with $150. $150 x 12 = $1800. The cap rate for this house is 44.44. My r.o.i. =$1800 / $10,000(down payment) = 18 % I said that the typical investment mall property retains 10 to 15% of its gross revenue. In plain laymans terms if the mall get 144 million in gross rents, after all expenses are paid it should keep 14.4 million to 21.6 million as net revenues before taxes. The usual goal for all landlords and real estate investors is a 20% annual R.O.I. (return on investment). The mall in question has been run very inefficiently. Management paid too much for services like cleaning , security etc. They weren't watching the bottom line. Tilton worked on the deal for quite a long time. Right now Tilton has made a very enviable deal. Most , who are not in real estate, would never even see this type of deal. Tilton did this. He went to a mall owner and said "Your mall has been appraised at 60 million u.s. I want to control 80% of it. I will give you 48 million in debentures that will pay you 8% interest a year. I will also give you an option to convert those debentures into 16 million shares when the share price gets to $3.00. Oh yes, the shares will have restrictions on them." The mall owners looked into TNRG and saw the opportunity that TNRG represented. They saw several medical devices that have huge potential, they saw a potential sea eye project they saw opportunity in a spots division, they saw a company that already does business in the pre fab building business. In short, they saw a way of owning a chunk of a company down the road, without having to put the cash up now. This is the best win-win deal you can get. Tilton now controls the mall and can make positive changes in it, to better the bottom line. He can bring in american products to further help the bottom line. His ties in china can also make the malls bottom line much better. And for this he put up how much of TNRG's current capital ? ZERO how much of TNRG's working capital will he use to service the dept? ZERO how much risk is associated with this deal? ZERO if the mall doesn't turn around, and tilton isn't satisfied with only taking home $160,000 a year from it, he can walk away from the deal with no ramifications what so ever for three (3) years. That is the law of the land in China. ( net revenue to TNRG 5 million x 80% = 4 million) (48 million x 8% = 3, 840,000 <-----debt service) (4 million less 3,840,000 = 160,000 net profit) -------------------------------------------------------------------- You guys just don't know what you have got in your hands. For those who want to continue posting confusing , misleading posts, please continue. in the short term you'll keep the price down for those of us that are accumulating .