Assignment Task:
In the beautiful city of Muskoka, Ontario, there was a significant amount of land of over 100 acres owned by a prominent Canadian family. The land had several mansions which were occupied by the family for generations. The area also included three parks and a commercial building which was built in the late 1800s. Over the last 70 years, family members had started to disperse and move out of the space. As such, the space was less utilized, and maintenance was costly. In March 2019, six family members who are the grandchildren of the original owners and heirs to the inheritance; got together and met with a potential buyer. The owners of the property expressed that their preference is to sell the property to an institution that can maintain its heritage and history. Their wish is for the land to be used for the benefit for society; therefore, public parks and converting the homes into hotels or museums, and this way, their family history can also be maintained. Although they were looking for fair compensation, they are more concerned with how the property will be used and have preference for a buyer who will satisfy their wish. They want representation on the board of directors for the property complex. They also want investors to be from the hospitality industry, so that the property can be used converted to hotels, parks etc. The buyer was a real estate firm interested in purchasing the land and transforming it into a resort. The real estate firm agreed that they would maintain the land as heritage space. They also confirmed that they would utilize the mansions as part of the resort and not break them down. They did not commit to not expanding further on the land. They were not comfortable with having family members on their board of directors as they felt that the family would exert too much control in the decisions that needed to be made on the property. They were willing to pay $80 million Canadian for the entire space with no board representation and a commitment to ensure that the property would maintain its heritage status. The owners came back with an offer of $75 million Canadian with two board positions and heritage status. The deal was in deadlock; neither party wanted to shift from their position. The real estate agency left the deal with no agreement. The owners did not receive another offer for five years.
I need sample brief answers for the following questions:
Q1. What negotiation tactics were used effectively in this deal? Explain what you think happened in this negotiation.
Q2. What negotiation tactics would you have used to close this deal both from the real estate firm and the owners?
Q3. How could this negotiation have resulted in a better outcome? Suggest some ideas that could have been utilized.
Q4. What is the most critical aspect in your opinion in negotiation, and why?