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Selling business with realestate. Very concerned if building will appraise out.

I have a buyer that has agreed to purchase my building and business, but in a down market I am concerned that the building will not appraise out. The building is 5 year old. I'm hoping it will at least appraise out to what it did 5 years ago. This could obviously be a deal breaker if it doesn't. Any thoughts or ideas if it doesn't appraise out?

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The BAF Group LLC

It really depends upon where you live and the kind of building it is, as to whether it will appraise as it did five years ago. And your options will vary, according to the Buyer's capabilities, the value of the business relative to the entire deal, whether the building is an integral part of the business, the overall nature of the current agreement, the attitude of your Buyer - lots of different issues! But one issue may be that the Buyer may wish to consider buying the business now, and leasing the building from you, until the Real Estate value returns to a level that is comfortable for both. If he/she balks, you could offer to set aside a portion of the Rent that is paid to act as part of the down payment on the eventual purchase of the building.

Apr 4, 2009