Vancouver Business Journal

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What businesses can expect this tax season

What businesses can expect this tax season

The tax man cometh – and just exactly what that means this year depends on your ...

Gold’s Gym to open in former Nordstrom space at Westfield Vancouver Mall

Gold’s Gym to open in former Nordstrom space at Westfield Vancouver Mall

Westfield Vancouver today announced the addition of Gold’s Gym, scheduled to ope...

State, local marijuana retail stores suddenly

State, local marijuana retail stores suddenly "flush with product"

Washington’s recreational marijuana business has been up and running for about s...

Top tech trends for 2015

Top tech trends for 2015

Remember when a cloud was just a puff of white or gray in the sky? A file was ma...

Port commissioners approve Northwest Packing Co. lease extension

Port commissioners approve Northwest Packing Co. lease extension

Fruit processor Northwest Packing Co. will continue to call Southwest Washington...

Trust reveals plan for Academy renovations

Trust reveals plan for Academy renovations

Although officially it won’t be a done deal until late January when escrow close...

Accounting & Finance

What businesses can expect this tax season

What businesses can expect this tax season

The tax man cometh – and just exactly what that means this year depends on your business. For some, the Affordable Care Act (ACA) will bring significant ramifications. For others, capitalization and repair rules are going to be a major concern. For businesses and CPAs alike, IRS response times could cause problems. In the following paragraphs, local CPAs share their expertise with VBJ readers to h...

Education & Workforce Development

Clark College expanding new Economic & Community Development Program

Clark College expanding new Economic & Community Development Program

While managing variables of supply and demand have been part of business culture for centuries, the concept has often been lost in terms of staffing and personnel development. Clark College’s Economic and Community Development Program (formerly Corporate and Continuing Education) looks to change that.

“The program really grew out of our contract learning projects. We saw a need and opportunity to...

News Briefs

Riverview, Heritage Bank report quarterly earnings

Vancouver-based Riverview Bancorp Inc. reported this week an income of $1.1 million, or $0.05 per diluted share, in the third fiscal quarter ended December 31, 2014. This compares to an income of $801,000, or $0.04 per diluted share, in the third quarter of 2013.

Spotlight

Feasting on success

Feasting on success

Scarcely out of the shadow of their second year, Harvest owner Chef Tim McCusker has opened his second Camas-based restaurant, Feast@316. Considering 90 percent of new restaurants do not see their first anniversary, the renowned restaurant consultant is banking on his track record of culinary success.

Launching on New Year’s Eve, Feast@316, a steak and seafood house located in downtown Camas, ope...

The real estate developer’s recipe for success

It may be odd to talk about how one might approach development activity when we are in the depths of a real estate market abyss, unless we discuss the issues for purposes of enabling a company to better prepare itself for times like these in the future.

It may be odd to talk about how one might approach development activity when we are in the depths of a real estate market abyss, unless we discuss the issues for purposes of enabling a company to better prepare itself for times like these in the future.

The Federal Reserve is engaging in such proactive preventative measures, proposing now to adopt rules cracking down on shady lending practices in an attempt to prevent a future mass mortgage crisis.

Never mind the hypocrisy of the Fed’s recent liberalization of its own lending practices that will certainly cost all taxpayers dearly in years to come – bailing out investment firms, Freddie Mac and other institutions … but enough about the Fed.

Real estate developers can, to a degree, determine their own fate. I asked an officer of a successful residential development company how the company is doing amid the current slowdown, and he replied, “Better than most of our competitors. We should survive – we’ve made it a policy to never borrow our equity.”

You might ask, “What did he mean by that?” In essence, he meant that they project realistic end-product sales prices for their proposed projects or lots, determine realistic land acquisition and construction/development costs and having determined the prospect for profit margin between the realistic sales price and realistic costs, they limit their borrowing to the costs – or less.

They do not, as some foundering contractors and developers may have done, build a “reasonable profit” component into the loans they obtain similarly to the way a residential lot owner’s loan for construction of his own house would include funds for the reasonable profit of his hired builder.

Successful developers do not see the bank loan as their end game, disbursing funds from it for new Cadillac Escalades for each of their family members and counting on 100 percent lot sales to pay off the bank before the loan matures. Their end game is the sale or lease of the developed property for profit – profit being the amount of money they take in from sales over and above their loans and other costs.

Projecting sales and profit takes real skill, planning, and self-control. It is more than pitching a project’s value to a bank at the project’s maximum potential value based on escalating lot prices in an upswinging market, borrowing the maximum amount possible and assuming the debt will be covered by prompt sales – which in manic times appear infinite. Project pro formas should not be substituted by blind trust that the bank’s crystal ball is accurately forecasting the project’s successful payoff of the debt.

There are various methods for evaluating a proposed development and limiting risks. It is conservative borrowing, however, that seems to distinguish the surviving developers – not superior salesmanship to a banker who may, himself, be running to the Fed for a loan, having guessed wrong on projects before.

David W. Meyer is an of-counsel attorney with of Bullivant Houser Bailey PC. Meyer can be reached at 360-737-2301 or This email address is being protected from spambots. You need JavaScript enabled to view it. .

Opinion

Focus Column

Cashing in: How to plan for business succession in a recovering economy

Cashing in: How to plan for business succession in a recovering economy

When it comes to retirement in the United States, nothing hurt business owners more than the financial crisis of 2008.

R...

Now is the time for apprenticeships

Now is the time for apprenticeships

There is much talk of the “skills gap” – the widening space between the technical skills that employers need and the ski...

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