When buyer and seller stall a turn apart on price, owned real estate is often the money already sitting on the table.
Most stalled deals are not stalled on strategy. They are a turn of EBITDA apart on price, and neither side wants to move first. If the business owns its facility, there is usually a third source of cash in the room that nobody has counted yet.
Why the gap forms
A buyer underwrites the operating business and prices it off earnings. The seller is pricing everything they built, including a building they bought years ago and have carried ever since. Both numbers can be defensible. The disagreement is often about what is being sold, not what it is worth.
What separating the property does
Sold on its own through a sale-leaseback, the real estate is priced off the rent the business pays, typically around an 8% cap rate, and can return up to 100% of the property's value in cash. Consider a hypothetical: a building supporting $800,000 of annual rent is worth roughly $11 million on its own, separate from whatever the buyer pays for the operating company. Your client keeps operating in the same building on a long-term lease.
Where it leaves the deal
The buyer acquires a business with a clean lease in place and less capital tied up in bricks. The seller gets full value for both halves instead of accepting a blended number for the pair. Bring it up while price is still being negotiated, because after an LOI it becomes a renegotiation rather than a structure.
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