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Name:
#1419 Well-Established Property Management Firm
Categories:
Service
Region:
Colorado Springs, Colorado
Industries:
Service
Segments:
Property Management
Asking Price:
$855,000  
Down Payment:
$125,000  
Revenue:
$1,616,082  
Adj. Profit:
$225,970  
Adj. Profit Type:
Seller's Discretionary Earnings  

Well-Established Property Management Firm - This property management company is one of the oldest in the Colorado Springs, Colorado area. It has a large and diversified client base that includes homeowner associations and individual property owners. Both the company and the industry, in general, have a long history of being recession resistant, due to its recurring monthly revenue. The company has a strong brand name in the marketplace. Highlights include well-established relationships with clients and a well-trained and experienced staff.

This firm should be an appealing acquisition candidate for: 1) an already established property management company looking to grow; 2) a real estate brokerage firm wanting to expand its line of services; or 3) a qualified individual with appropriate experience. The real estate is available to purchase for $350,000. Contact Ron Brasch. BUSINESS SUMMARY

Notes of Explanation:
  1. TBS = "To Be Suggested"
  2. Seller's Adjusted Profit

The Seller's Adjusted Profit is a calculation showing the cash flow generated by the Business for the most recent tax year, unless otherwise indicated, by adding back to the net profit those costs that are discretionary to the Seller. These costs could include the owner's salary and benefits, interest paid on the seller's notes/debts that are not assumed by the buyer, non-cash expenses such as depreciation (in appropriate situations) and amortization, and certain non-recurring or unusual expenses. Details of the Adjusted Profit calculations are available in each presentation package and in our files.

"An Economic Basket"

Another way of viewing the Seller's Adjusted Profit is as the historic economic basket of benefits available to the new owner so he can:

  1. Pay himself an appropriate wage commensurate with the skill required to manage the business.
  2. Service any debt incurred to purchase the business.
  3. Receive a reasonable rate of return on the down payment invested. (The appropriate rate of return depends on market conditions and the size of the business. For smaller transactions the rate of return on investment is not usually a significant factor in the valuation.