A closely held entity is expanding and needs a new distribution facility on the West Coast to service its West Coast customers more efficiently. The facility has an estimated cost of $10 million. The owners are considering three alternative plans:

1) Borrow the $10 million and build the facility.

2) Recruit more owners to raise the $10 million to build the facility. 

3) The current owners can build the facility and lease it to the corporation. 

a) Discuss the tax and nontax issues related to each strategy. Are there other details that you need to know (think about all parties, all taxes, all costs)?