cbcorion's blog

Since the largest part of the purchase price of a profitable small business is usually goodwill, it is important to have knowledge and understanding of just what goodwill is and why there is value in it. 

Business value is not built solely on the accumulation of tangible assets, such as equipment and machinery, but also on the intangibles, known as goodwill, that contribute to its profitability. The value of a business is determined by its ability to generate cash flow and the risks associated with consistently producing that cash flow.

There are situations that justify a quick and easy business valuation based on Rules of Thumb, rather than a lengthy and costly business valuation.  To apply Rules of Thumb, the first step is to determine seller discretionary earnings (SDE).  This is calculated by adding back certain non typical expenses as well as non cash expenses to the net operating income.  This calculation is the first and most important step when valuing a business and should only be attempted by an experienced business broker.  A miscalculation of SDE will produce an inaccurate business valuation.

While senior housing has always been a profitable industry, it has really been able to stand on its own two feet recently as a viable and significant class of real estate – with more and more outside investors jumping on board and adding senior housing to their portfolios. In a recent survey conducted by the National Investment Center for Seniors Housing and Care (NIC) and National Real Estate Investor (NREI), senior housing was once again the most attractive real estate asset class when compared to a host of other commercial real estate classes, including industrial, hotels, multifamily housing, office and retail, and more.

While contracts for deed offer some advantages over a traditional mortgage, such as speed and simplicity, they can offer advantages and disadvantages.  In a contract for deed, the purchase of property is financed by the seller,  rather than a third-party lender such as a commercial bank or credit union. The arrangement can benefit buyers and sellers by extending credit to buyers who would not otherwise qualify for a loan. 

For decades, large department stores served as the anchor store for malls and shopping centers. The anchor is the main attraction while all of the other retail shops inside of the mall pay the majority of the lease. Without the anchor, the mall dies. With so many big anchor stores closing in malls throughout America, could grocery stores replace department stores as the new “mall” of our era?

I’ve heard that some retailers are going with a co-tenancy program.  What does that mean?