Letter to Metrospaces shareholders August 2021
NEW YORK, NY, Aug 19, 2021 (GLOBE NEWSWIRE) – via NewMediaWire – Metrospaces inc. (MSPC):
LETTER TO OUR SHAREHOLDERS
What started as an already surprisingly positive year for the company’s economic situation continues to surprise on the upside. The company has not only successfully launched its business transformation from a traditional real estate developer to a cutting edge technology company, but in just 8 months it is now showing positive EBITDA. In addition, he reduced total liabilities by 65% in the first 6 months of 2021, with high expectations of having a positive balance sheet and equity by the end of the 3rd quarter of this year. However, the most exciting part of the business transformation is that we are clearly in a position to be a leader in the prop technology industry, with the tokenization of real estate assets being our primary driver. We see a clear opportunity to be a force for transformation and innovation in this industry.
Partnership with Shokworks: Shokworks is a world-class blockchain and crypto-venture builder, with industry expertise matched by very, very few. They have been involved in 5-6 blockchain projects with recognized success. For reference, notable customers of Shokworks include industry leaders such as Cryptobucks, the world’s first payment platform to accept credit cards, debit cards, and crypto payments; Kinesis Money, a fully allocated gold and silver bullion-backed monetary system that includes a yield engine, money transfer, exchange, and a physical and digital debit card that has generated over $ 10 billion. dollars in transactions since its inception and currently has over 70,000 users; and Compass Mining, a decentralized Bitcoin-focused hashrate growth strengthening the network’s security system by helping more people learn, explore and mine bitcoin. This assessment gives us the confidence that we have the IT partner who could help us become the most successful player in the real estate tokenization sector.
Metrohouse – Cohabitation platform: We started the development of the co-living platform at the beginning of May this year. The development phase has gone on schedule and we believe the main platform will be complete by September 15, as originally announced. However, we are now looking at several joint venture partnerships with owners of multi-family residential buildings to integrate as inventory into the platform, which just weren’t there, or probably even imaginable there are only 1 to 2. month. Therefore, we will be pushing back the launch date of the platform until October 30 to give us time to integrate these new joint ventures with potentially new buildings in the platform. The delay, which is not significant in the scope of our business plan, will allow a larger and more robust launch since this new inventory will exceed us by several months compared to what we had initially planned. In short, a delay in launching the platform will likely give us several months of revenue growth before what we originally envisioned producing the Metrohouse launch. We will refrain from giving a forecast on the economics of the platform until we are fully able to form these partnerships.
Metrocrowd – Tokenization platform: The company is at full speed in developing its own tokenization platform, which will not only cater to third-party property owners and developers, but also allow the company to be a principal. The platform will launch in multiple stages, with October 30 being the launch date for the first stage, with rollouts continuing until mid-December when we expect the final version to be active. The platform will be offered to world-class real estate developers and owners as a third-party service. In addition, we will seek to be the primary assets that we will later tokenize on the platform. Our intention is not to be a company with sustainable assets, but we will certainly seek to take advantage of any exceptional opportunity that we find in the market. We will use a variety of strategies to fund these acquisitions, including partnerships with private investors and other off-balance sheet structures. We believe that the leader in this space will not only be the one who develops the best technology, but the one who is able to bring the most profitable and unique real estate assets to the platform. With a solid background in property ownership and development, our management team has extraordinary access to the flow of transactions in real estate assets, both with third party owners and assets to be acquired. This is why we believe that the acquisition of the Brazos Atrium building in Houston is a fundamental acquisition. In the short term, this will give the company enough NOI to be positive in terms of EBITDA; However, in the medium term, this asset will represent an incredible investment opportunity for anyone who acquires the token that we will end up selling based on this asset. Our plan will be to implement all kinds of proptech-based management solutions that will reduce operating costs and thus increase NOI. The company acquired this asset at a capitalization rate of 12%. On a leveraged basis, we expect this asset to generate an IRR above 30% for the company and future token investors. This case study will help us shape our business plan and show the industry what our vision is and what we are capable of doing.
Other acquisitions: The company sees an extraordinary opportunity for organic growth, however, mergers and acquisitions and the acquisition of real estate assets will also be an important driver of our business plan. We will refrain from generating expectations about possible additional acquisition opportunities as we prefer to announce completed transactions and then talk about possibilities. The Brazos Atrium building is one example.
Investment in IQSTel, Inc. : While we are still strong supporters and large shareholders of IQSTel, Inc. (OTC: IQST), we will seek to slowly and completely divest from this investment so that we can use our capital to continue to grow our current business. Even though investing in IQSTel was once an important part of our business plan, we are simply seeing better allocation opportunities for our capital.
Balance sheet and capital structure: We understand shareholder concerns about issuing new shares to repay debt. However, we can assure our shareholders that we are conducting a responsible plan to issue as few shares as possible in order to fully repay the debt. We are convinced that the repayment of these loans through new issues of shares is the best allocation of our capital and that the repayment of this debt will be a huge driver in the short term for the valuation of our company. We understand that this may cause short-term volatility in our valuation, but this is why we emphasize that Metrospaces shareholders should be mid- to long-term investors and should focus on our business plan, not so much about our outstanding shares. We believe that, if not all, most of our outstanding debt will be repaid by the 3rd quarter of this year. This, along with the continued growth of our assets, will give us a positive balance sheet by September 30 of this year, hopefully. Based on specific numbers, this year alone we increased assets from $ 213,130 to $ 1,453,595 while lowering all liabilities from $ 14,810,640 to $ 5,430,996 from December 30, 2020 to June 30, 2021 This resulted in a decrease in the net liability of our shareholders from $ 14,597,510 to $ 4,007,401 during the same period. We will see this situation continue to improve as we consolidate the acquisition of the Brazos Atrium building in our financial statements and continue to repay the debt.
Management team: We have recently strengthened our management team by incorporating Alejandro Laplana and Daniel Laplana of Shokworks, respectively as CTO and SVP of Business Development, whose CV and past successes speak for themselves. We are also looking to incorporate a CFO in the coming weeks. We believe these new team members will continue to help us move beyond our business plan to become a leader in real estate coliving and tokenization.
Communication to shareholders: We recognize that our public statements have, on a few occasions, not lived up to the highest standards and that we have sometimes mistakenly provided information that was not entirely accurate. We sincerely apologize for these mistakes, as integrity is one of our core values. Once again, we sincerely apologize and promise that by incorporating more people into our team, we will do a much better job in this regard. Thank you for your trust and understanding. We are also looking for better and more sustained means of communication with our shareholders, which we will integrate in the coming weeks.
Safe Harbor Declaration: Statements contained in this press release may be “forward-looking statements”. Forward-looking statements include, without limitation, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statement relating to our future business or other future events or conditions. These statements are based on current expectations, estimates and projections about our business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results and results may differ materially from what is expressed or expected in forward-looking statements due to many factors. All forward-looking statements speak only as of the date of this press release, and Metrospaces Inc. assumes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release.
Source: Metrospaces, Inc.