Block House Developments (BHD) is a real estate development company that provides affordable accommodation for students. The vision for BHD is to become the market leader in student accommodation, by providing quality individual living spaces as well as communal living arrangements where students can build a community and share resources.

These communal living spaces include facilities such as a library, BBQ area and a games room. This can help their tenants to form a student community where they can share books, meals and take part in fun activities.

The company has constructed its first apartment building and have just completed its first year of operations.

However, the company currently faces several problems that must be addressed, namely:

• After one year of operations, only 50% of the rooms are occupied. The company wants to increase its occupancy rate. However, the sales team don't get any commissions for obtaining clients, so they lack motivation. The company also don't have an advertising or marketing strategy to attract more tenants.
• The company initially told students that it would provide access to a gym and swimming pool for its tenants, but later on decided not to provide these facilities due to the costs involved. Some of the tenants are now complaining that these facilities are not available to them.
• As the company had lower revenues this year, it had to take out a high interest cash loan of $400,000 to help cover its operational costs. The interest payments on this loan is very high and it is now negatively impacting the cash flow position of the company.

After the first year of operations, the company can spend $100,000 to help solve the above problems.

• List 3 questions you can ask the salespeople to help you determine your position about the problem of low room occupancy.