SPRING 2022
SELL THE REAL ESTATE WITH THE BUSINESS
Be prepared to consider the buyers’ preferences. Most buyers who are interested in
purchasing the business would like to buy the real estate. It is not uncommon to have a
buyer backout because the real estate is not part of the purchase. Probably the greatest
misconception is that the buyer “can’t afford to buy it all now.” While this used to be accurate,
it is not true today. There are many commercial lenders with funds readily available for
qualified buyers to purchase the real estate along with the business. Moreover, with the
current interest rates and favorable terms available today, the mortgage payment on the real
estate is typically about the same as a rent payment would be.
CONSIDERING A SALE TO A THIRD-PARTY BUYER
One possible outcome may be that you sell the property to a third-party who then leases
the property back to the buyer. The separate transaction can be seamless to the seller. This
scenario could be a win-win for a buyer who does not want the real estate obligation and you
still get the liquidity.
Ultimately the decision to sell or hold your real estate depends on many factors. Honestly
evaluate whether you want ongoing involvement as a property manager after the sale and the
current real estate market in your area. Most importantly, assess your finances and long-term
objectives for retirement.
STACY CADIEUX
CBI
Business Transition Consultant with Simmons & Associates Southcentral.