Quarterly Q&A – Summer 2018

Q: Why do I need to know the value of my real estate when determining how much my business is worth?            

A: Many times when I am seeking the value of a business, the business will be operated out of a location that is owned by an outside entity where the shareholders are the same.  When this is the case, typically the monthly rent is lower than market.  When a normal rent factor is applied, one typically finds that the real estate is where the equity is and not in the business.  When the day comes that you want to sell or gift your company, you may find that you only have your real estate to sell or give.  Plan wisely for the goals you wish to obtain.