Royal Realty Annual Report

Annual Report
2018-2019
[email protected]
royalrealtyny.wixsite.com
37-02 47th Avenue
Long Island City, NY
(718) 937-3010
ROYAL REALTY ANNUAL REPORT 2018-2019
Table of Contents
BOARD OF DIRECTORS AND MANAGEMENT ............................................3
LETTER TO THE STOCKHOLDERS ............................................................ 4-5
TOP MANAGEMENT OF ROYAL REALTY ....................................................6
CORPORATE MESSAGE .....................................................................................7
CORPORATE MISSION ............................................................................................ 7
MANAGEMENT PHILOSOPHY .................................................................................. 8
PRODUCT/SERVICES............................................................................................... 9
REVENUE AND PROFITABILITY ............................................................................. 10
CORPORATE CULTURE ......................................................................................... 11
FINANCIAL HIGHLIGHTS ......................................................................... 12-16
FINANCIAL STATEMENT AND FOOTNOTES ....................................... 17-18
RATIO ANALYSIS ................................................................................................. 19
FINANCIAL WRITE UP ..................................................................................... 20-21
MANAGEMENT DISCUSSION AND ANALYSIS...........................................22
FINANCIAL PERFORMANCE .................................................................................. 22
COMPANY GOALS ................................................................................................ 22
MARKETING AND ADVERTISING PLAN ................................................................. 23
MARKET RESEARCH ....................................................................................... 23-24
ADVERTISING CAMPAIGN .................................................................................... 24
TARGET MARKETS ............................................................................................... 25
TRADE SHOW RESEARCH ..................................................................................... 25
CORPORATE WEBSITE .......................................................................................... 26
BRAND AWARENESS ............................................................................................ 26
RISKS EXPECTED ................................................................................................. 27
STRATEGIC DIRECTION ........................................................................................ 27
BANK STATEMENT ...........................................................................................28
LOAN AMORTIZATION TABLE .....................................................................29
NON-VE SALES CONTRACT ............................................................................30
ACHIEVEMENTS ................................................................................................31
2
Board of directors and management
Queens Technical High School Principal: Ms. Melissa Burg
Assistant Principal: Mr. Claudio Garcia
Angel Investor: Mr. Angel Panora
VE Regional Director: Paul Presti
Angel Investor: Mrs. Tiffany Sankari Sameyah
VE Coordinator: Ms. Nadine Morgan Thomas
3
Letter to the Stockholders
Dear stockholders,
Royal Realty has successfully completed their first fiscal year of operations during time
frame of 2018-2019. Royal Realty first began operating on October 15th we decided it was our
mission to satisfy our customers by providing them with affordable and eco- friendly micro
apartments that incorporate innovative technologies that revolutionize the way they live. All
throughout the fiscal year we have worked tenaciously to provide our customers with a safe and
affordable place to live that met all their needs.
We provided our tenants with three types of micro apartment styles such as a studio, one-
bedroom, and two-bedroom. In addition, we also provided our tenants with amenities such as a
fitness center, screening room, and an indoor pool. Our amenities gave them a sense of
community and allowed them to form a connection with each other. On top of the many
commodities we offer we have incorporated innovative technologies in our apartments.
Technologies like Wi-Fi video doorbell, wireless charging on the counter, and smart locks. By
utilizing the need for affordable apartments in the city of New York Royal Realty was able to
succeed in the real estate industry, maintain its core values and everything the company stands
for.
In the beginning of the year our sales totaled up to $63,000. Nonetheless as time
proceeded, we began to see an increase in sales leading up to the month of April where we made
$230,000 in sales due to our participation at the 2019 Youth Business Summit. This resulted in
us surpassing our sales goal of $200,000. Royal Realty first started out with a loan of $150,000
where we planned on utilizing the money for the maintenance of the building, as well as
covering the startup cost and the operating expenses of the company. We have made a total of
$155,000 online sales for the months of February, March, April, and May.
Royal Realty had a primary goal of gaining 90% occupancy in our complex building.
This year Royal Realty was able to meet this major goal. Royal Realty’s future in the real estate
industry is looking bright but it’s only the beginning. Royal Realty plans on expanding to other
boroughs in New York City such as Brooklyn, Bronx, Manhattan, and Staten Island.
An example of one of our virtual competitors is 99@dventures. Above being a travel

agency, they are also a real estate company that leases apartments at an affordable price in
different cities of the united states. While this company provides affordable apartments in
different locations their prices are unrealistic because their apartments are large-scaled
meanwhile our prices are realistic due to our service of renting micro apartments.
We have made ourselves stand out in the real estate industry by being the first VE real
estate firm to offer micro apartments that are affordable. With this service we have attracted a
4
new different market which was migrating companies, competing companies in the real estate
industry may have a variety of services that can attract consumers instantly, but it is our goals
and missions of provide clients with an affordable way of living that has allowed us to succeed.
Projected
250000
200000
150000
100000
50000
0
October November December January February March April
Online Tradeshow Direct Out-of-Network Other
Actual
250000
200000
150000
100000
50000
0
From what we projected in our business plan we managed to surpass our goal of $200,000 for the
tradeshow of March and got a total of $230,000. Every other month we managed to stay
consistent on what we projected to make during those months. In both projected and actuals
January can be seen with no sales made, this is due to our sales department lacking employees.
Although we struggled for the month of January we managed to recover from a month with no
revenue from the tradeshow.
Sincerely,
Samuel Filpo
Samuel Filpo
Chief Executive Officer
5
Top Management of Royal Realty
Left: Samuel Filpo

(Chief Executive Officer)
Middle: Max Romero

(Chief Operation Officer)
Right: Saul Guzman

(Chief Financial Officer)
6
Corporate Message
Corporate Mission
Royal realty was established on October 15, 2018. We revolve around the idea of
rehabilitating the communities in which we place our apartments with the addition of our
innovative apartments. Our services provided are Studio, One Bedroom, and Two Bedroom micro
apartments as well as amenities that serve a purpose to increase both the quality of life and
service.
Royal Realty strives to be one of the top realty firms in the city of New York by providing
affordable, and Innovative micro-apartments. We make the difficulties of renting apartments
easier for first-time residents/renters. It is our mission to satisfy our customers by providing them
with affordable, Eco-Friendly Micro apartments that incorporate innovative technology that
revolutionizes the way they live.
These are some of our

company’s promotional
flyers that showcase
examples of the types of
Micro apartments we
provide, as well as our
affordable prices which
is an important aspect of
our company.
7
Management Philosophy
All staff members of Royal Realty are expected to efficiently and organizationally make
a logical and reliable decision that ensures the success of the company. In order to accomplish
this expectation, Royal Realty has adopted a Decision-Making Process that goes as follows:
¨ Defining the problem
¨ Limiting factors
¨ Potential Alternatives.
¨ Analyze factors and alternatives.
¨ Enforce the decision
¨ Evaluate the system and control
The above system is globally used and ensures that many companies run smoothly when facing
high-risk decisions. All managers are advised to have a department meeting where they will be
able to discuss and follow the Decision-Making Process and create an Agenda as a team. Shortly
after, in an already pre-scheduled meeting, the Managers will be able to discuss their Agenda
with a vice president and their chief executive supervisor. In this meeting, Minutes will be
expected to be taken, where all the discussion will be written down and the date of the next
meeting is addressed. Both the Agenda and Minutes are handed to the manager of
Administration Department where they are stored for future references.
8
Product/Services
Royal Realty offers 3 types of micro apartments such as a Studio, One-Bedroom,
and Two Bedroom micro apartments. We also offer amenities that will give our
tenants a sense of community and the opportunity to communicate with each
other.
Contemporary Life Studio Micro

Apartment
Rent for: $500/Monthly

With amenities $1,000/Monthly
Creative Life One-Bedroom Micro

Apartment
Rent for: $1,000/Monthly

Oceanic Life Two-Bedroom Micro

Apartment
Rent for: $2,000/Monthly

Additional Products/Services
9
Revenue and Profitability

Royal Realty has used several methods of gaining revenue and making a profit. One of those methods
being our company website. Our company website was designed by our graphics department in which
they devoted all their time and energy into providing consumers with a successful website that makes it
easy for potential customers to rent the apartment that they desire at an affordable price. Our website
increased mobility and provided our customer’s ease when renting an apartment. In addition to our
website, Royal Realty utilized three different types of social media platforms such as Instagram, Twitter,
and Snapchat where we posted new apartments that were available for rent, our participation in activities
regarding our company and reminders about our services being offered.
This is an example of our company’s

website. The page in the figure above
shows the three different micro
apartment styles we offer along with
their prices. We separate the
different micro apartment styles into
three different categories making it
easier for potential customers to click
on what they are looking for. The
figure below showcases the variety of
studio apartment we offer; below it
has two buttons one to “rent” the
apartment at the regular price it
comes in and another one to add
“amenities” with the apartment you
will be renting doubling the price of
the apartment by $500.
10
Corporate Culture
Core values of a company define who they are. It is a mean of creation that shows a company’s
vision, mission, and norms to the public and its employees. These values will keep an organization
together and ensure the growth of the company in an industry against any competitors and market. This
is why Royal realty has embodied three core values:
• Customer commitment
We develop professional customer relationships that allow us to always meet their personalized needs
and wants, in turn creating a positive renting experience.
• Quality services and products
We ensure that all our services and products are top notch because we do not our customers to use what
we would not use ourselves.
• Community and environmental awareness
We aim to make all complex buildings eco-friendly and a reflection of the diverse communities
surrounding them.
Royal Realty’s Vice Presidents of the Month for the months of October, November, December, and January.
Amy Narvaez, Danidza Cartagena, Paola Gonzalez, and Jamling Sherpa Llama.
Royal Realty’s Employee of the month for the months of October, November, December, and January.
Sonia Martinez
11
Financial Highlights
Our Income Statement shows that we have made a

total net profit of 251,193 compared to what we
had projected to be 161,897. There was a total
percentage increase of 60%. Our sales revenue was
divided into three major categories, those
categories were Trade Fair Revenues, Contractual
sales to non-VE students, and Other than trade fair
revenues. Our total revenue for trade fair is
293,000. Compared to our projected revenue being
200,000, we saw an increase of 47%.
12
Royal Realty was precise on what their goals wanted to be and how we wanted this firm to
succeed we’ve been seeing an increase in sales and a major positive net gain in sales.
13
Monthly Sales
250000
200000
150000
100000
50000
0
14
Sales by Product
Studio
2 Bedroom w/ Amedities
2 Bedroom
1 Bedroom w/ Amedities
1 Bedroom
0 20,000 40,000 60,000 80,000 100,000 120,000
15
Sales by Geography
100%
16
Financial Statement and Footnotes

Financial Statements
17
Balance Sheet
18
Ratio Analysis
Current Ratio: 247,640/142,450 = 1.738
Quick Ratio: (247,640-25,000)/142,450 = 1.562
Gross Profit Margin: 389,500/161,721 = 2.408
Net Profit Margin: 161,721/414,500 = 0.390
Debt to Asset Ratio: 292,450/298,871 = 0.978
19
Financial Write up
Income Statement
Our Income Statement shows that we have made a total net profit of 259,193 compared to what
we had projected to be 161,897. There was a total percentage increase of 60%. Our sales revenue
was divided into three major categories, those categories were Trade Fair Revenues, Contractual
sales to non-VE students, and Other than trade fair revenues. Our total revenue for the trade fair
is 293,000. Compared to our projected revenue being 200,000, we saw an increase of 47%. In all
the other categories we did not make any revenue due to the lack of employees in our sales
department. Even though we struggled for the first four months the tradeshows gave us enough
income to sustain our company. Hence, we met our projections, making it a very successful year.
It would appear as we underestimated our projections because we surpassed our projected sales
by 90,000.
Cash Budget
Our Cash Budget indicates that we have a larger ending balance compared to what our beginning
balance is. We were fortunate enough to have purchased our building as part of a revitalization
program which only cost us 25,000. Hence, lowering our expenses for the remaining of the year.
Balance Sheet
Our Balance Sheet shows that we will have more assets due to us having to buy more amenities
for a well-established business. We made sure to keep track of all sales made and we managed to
get a total of $17,000 in Accounts Receivable. At the end of our fiscal year, we have a total of
$150,000 remaining from our loan. As of April 30, 2019, we have a debt ratio of 0.98 due to
having more assets.
Ratios and Cash Flow

We have a quick ratio of 1.5; which means we have $1.5 dollars for every $1 of debt. We have a
net profit margin of 0.30% and a gross profit margin of 2.4%. Our debt to asset ratio is 0.97. Our
cash flow is relatively stable. Throughout our first few months, cash flow was inconsistent, but
an increase of cash flow came around the months of November through April.
20
Cash Flow
Cash Flow throughout the fiscal year has been relatively unvarying, since our monthly sales goal
were impacted as not many sales were made outside of the months of trade shows, being
November and March. During these months is when we saw an increase in sales and a major
positive net gain in sales. As of April 21, 2019, our corporate debt levels were at 150,000.
According to our loan amortization chart, we should be able to pay back the debt by the end of
the next fiscal year. The lack of employment in the sales department was a major reason for the
lack of sales made in the months where no trade shows were in place. We did manage to make
sales throughout the months, but they were not heavy sales.
21
Management Discussion and Analysis

Financial Performance
Since the origin of Royal Realty, the expectations for our company were unclear. Yet our first
financial highlight includes our first ever trade show where the company made its debut on the
Virtual Enterprise scene. After tallying up sales in our first trade show we surpassed our
expected goal of $90,000.00 and made over $130,000.00 in sales for our micro-apartments. This
brought our attention to the potential in our business which would ultimately bring up the
motivation behind our product and incorporate different themes to give our clients the flexibility
to choose a home that best fits them. This allowed us not only to make what Royal Realty
invested into our craft but break even within the first 5 months after trade show efforts and
setting out the strategy on not only selling to individuals but selling as a package deal to
continuous firms. This achievement would not have been possible without the extra attention the
firm was able to receive after winning our first ever business competition and ultimately making
it to the citywide stage. Our sales eventually hit a jump and were recognized by our competitors
which ultimately gave Royal Realty a second look in the utilization of our product.
Company Goals
Non- financially we provide better customer services, we communicated with our customers to
know what kind of apartment they were looking for. We also asked if they wanted to include
amenities to their purchase. We also increased efficiency in the company, we communicated
with our company on our goal, so they focused on it. Improved employee training helped us
reach our goal. By communicating with our company on what had to be done and what we had to
focus the better the results of renting apartments.
Financially monthly sales projection:
• Total Online Sales $190,000

• Total Trade show Sales $201,947
• Total Direct Sales $180.000
• Total out-of- network sales $145,000
Some goals for the rest of the year and ongoing years is to create a new customer service
process. This will ensure we get feedback from our customers in order to identify how our
company can do better. Increase our brand awareness, to be able to rent more to new customers.
We would also want to create a new employee program to keep our customers motivated and
morale in our company. Working in a business can be really challenging and doing this program
will change the way our customers work throughout the year.
22
Marketing and Advertising Plan
- Planned projected sales and made more than projected during trade shows
Plans at the beginning of year What happened
¨ Sell apartments ¨ Rent out apartments

¨ Target all age groups ¨ Target readjusts to VE students
¨ Families ¨ Generation Z (18-21)
¨ Millennials ¨ Migrating Companies (moving employees)
- We planned to sell apartments when the firm first came together but then it was switched to
renting apartments in order to create cash flow for the company and not rely on one-time sales.
- We primarily planned on targeting all age groups and families but then we changed it to strictly
VE students as our primary target because of the high demand caused by mandatory ownership
of property throughout the year. Second, came Generation Z because of the pictured scenario of
fresh out of college/high school students searching for apartments but limited to a budget
because of other financial focuses. Lastly comes migrating companies and the employees
moving from other states focusing on finding a new home.
- Since it is expensive to live in New York City we decided to price our apartments accordingly
to compete with the competition and attract potential clientele while still being able to make a
profit at the same time.
Market Research
Before conducting any Royal Realty operations, the company wanted to scan the industry before
diving in, while doing this we noticed that real estate in our primary geographic target had been
rising in Long Island City. People had loved the idea of Long Island City’s small microcosm of
cultures, ideas, and people. At the time of looking at real estate in Long Island City, Royal
Realty had already stumbled upon an unfinished idea by former NYC Mayor Bloomberg
revolving around Micro Apartments involving Micro Unit Apartments that were supposed to
begin at 250 square feet. Royal Realty took the idea increased the starting size to 450 square feet
and was able to manage to price to the point where the firm had a competitive edge over others
while still being able to make a profit. In the case of our business, we realized that renting a
home in Long Island City is just as difficult as buying one due to its high demand and low
availability. We wanted to have a direct impact after noticing that Long Island City’s real estate
industry has developed into a highly competitive nature with the rent prices being stable for a
number of months and the rent prices being 18 percent lower than the city average, this would
23
allow us to find tenants without a problem considering the fact that our prices are already lower
than the city average in LIC.
Advertising Campaign
We used social media as a strategy to reach potential clientele not only in the US but
internationally as well since social media is accessible to everyone. We were able to acquire
clients through social media because of the platform Instagram which allowed us to connect with
other VE firms. We also have a snapchat, Facebook and twitter account.
Target Markets
24
Target Markets
Our targets most likely are living in New York City making it affordable for them. Our company
offers and provides to the virtual enterprise community, recent college graduates, and millennials
and can now have a safe and comfortable place to live with amenity. Our targets are listed below
Demographic VE Community Generation Z Migrating Companies

Geographic LIC, NY NYC Major Markets
Psychographic Social Financially Conservative Concerned Executives
Social Economics H.S and College Graduates Lower to middle class Big Markets
Benefits Eco- Friendly Innovative Rapid
Trade Show Research
Above is our trade show booth for the 2019 Youth Business Summit Convention. Our trade show
booth was specifically designed to make sure we incorporated as many themes within our
website as possible to make sure our clients found a style, location, and lifestyle of their
choosing. As you can see there were three sections with three different types of brochures that
showed all of our themed apartments which helped us easily pass our goal of $200,000.00 and
make over $230,000.00 in the sales revenue which not only passed our goal but also made up for
the amount that was left to reach in our projected previous month’s sales goal.
25
Corporate Website
On the Chart above is our website sales as early as the month of February. There are events that
Royal Realty attended that can be related to the spike in sales that is shown in the past couple of
months for the company. Whether it be the April Trade Show Summit. Or, the business plan
competition citywide. February Royal Realty was just missing our 30,000-dollar sale goal but 1
thousand dollars, but as of recently, our sale numbers have increased drastically by surpassing
our goal by at least 10,000 dollars or more. Only 2 weeks into April and Royal Realty has
already passed our monthly projection by 4,000 dollars.
Brand Awareness
We made social media accounts for our company and we followed other VE firms and reposted
other VE firms Instagram page in return for them doing the same so we both have our companies
exposed to different followers we each have. In the trade show, we networked with numerous
companies and informed them about our products so that in the future if they want to rent an
apartment, they can always come to us. We made numerous direct calls to other schools
informing them about our products and seek for potential clients due to students required to own
property in VE throughout the school year. We made direct emails to other firms as well as
sending them our sales pitch. During the business plan competition, we were able to network
with other firms that were there and build relationships with them for possible future deals.
26
Risks Expected
The risks we expected was getting a high rate of occupancy in time in order to break even and
start making profits. We also risked the factor that we were building an apartment in a
neighborhood that isn’t that good which could be a factor to why people wouldn’t want to rent in
that area. The other risks that we took were that our budget projected could’ve gone over and we
would pass the amount of money we had which would make us take more loans.
Strategic Direction
With all the goals we have to accomplish our company will continue to grow. Some goals our
company will be looking for the future will be to continue to buy and sell to our customers with
our help they can pick from a variety of themes. We will also continually explore new ideas and
technology to make the selling and buying of our company faster, costly and easier.
27
Bank Statement
28
Loan Amortization Table
29
Non-VE Sales Contract
This Is an example of
a lease agreement for
New York City
Residents.
This Is an example of
a lease agreement for
New York City
Residents.
30
Achievements
2018-2019 National Online Competitions

2018-2019
Honorable National
Mention- NationalOnline
ElevatorCompetitions
Pitch Competition
2018-2019
Honorable National
(Competing
Mention- National Online
against Competitions
472 Entries)
Elevator Pitch Competition
(Competing against 472 Entries)
2018-2019
Honorable National
Mention- National Online
ElevatorCompetitions
Pitch Competition
HonorableBusiness Plan Elevator
Mention- National Competitions
Pitch Competition
Honorable Mention- National Elevator Pitch Competition
Business
2018-2019
Honorable Mention-Plan
National
(CompetingNYC Competitions
Online
Citywide
against Competitions
Business Plan
472 Entries)
Competition
Honorable
Business
2018-2019 Plan
National
(Competing
Mention-
Competitions
Online
against
National
Competitions
472 Entries)
ElevatorMention
Pitch Competition
(Out of 6 Teams, Royal Realty won Honorable moving on to the
2018-2019 National Online
Business Plan Competitions
national Business Plan Competitions
Competition)
Honorable
2018-2019Mention- NYCOnline
National Citywide Business Plan
Competitions
Business Competition
Plan Competitions
(Out of 6 Teams, Royal Realty won Honorable Mention moving on to the
national Honorable
Business
2018-2019 National Mention Plan Competition)
Online Competitions
Business
Honorable Plan
Mention- NYC Competitions
Honorable
Citywide Business Plan
2018-2019 National
Mention
Online
Competition Competitions
Business PlanOnline
Competitions
Honorable
Mention
2018-2019 National Competitions
(Out of 6 Teams, Royal RealtyHonorable
won Honorable Mention moving on to the
national Business Plan Competition)
Mention
2018-2019 National
Honorable Online Competitions 31
Mention
32

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Annual Report

Board of directors and management

Queens Technical High School Principal: Ms. Melissa Burg

Assistant Principal: Mr. Claudio Garcia

Angel Investor: Mr. Angel Panora

VE Regional Director: Paul Presti

Angel Investor: Mrs. Tiffany Sankari Sameyah

VE Coordinator: Ms. Nadine Morgan Thomas

Letter to the Stockholders

An example of one of our virtual competitors is 99@dventures. Above being a travel

Online Tradeshow Direct Out-of-Network Other

Online Tradeshow Direct Out-of-Network Other

Top Management of Royal Realty

Left: Samuel Filpo

Middle: Max Romero

Right: Saul Guzman

These are some of our

Contemporary Life Studio Micro

Rent for: $500/Monthly

Creative Life One-Bedroom Micro

Rent for: $1,000/Monthly

Oceanic Life Two-Bedroom Micro

Rent for: $2,000/Monthly

Revenue and Profitability

This is an example of our company’s

Our Income Statement shows that we have made a

Online Tradeshow Direct Out-of-Network Other

0 20,000 40,000 60,000 80,000 100,000 120,000

Financial Statement and Footnotes

Current Ratio: 247,640/142,450 = 1.738

Quick Ratio: (247,640-25,000)/142,450 = 1.562

Gross Profit Margin: 389,500/161,721 = 2.408

Net Profit Margin: 161,721/414,500 = 0.390

Debt to Asset Ratio: 292,450/298,871 = 0.978

Ratios and Cash Flow

Management Discussion and Analysis

Financially monthly sales projection:

• Total Online Sales $190,000

Marketing and Advertising Plan

Plans at the beginning of year What happened

¨ Sell apartments ¨ Rent out apartments

Demographic VE Community Generation Z Migrating Companies

Trade Show Research

Loan Amortization Table

Non-VE Sales Contract

2018-2019 National Online Competitions

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