Ahhh everyones fav question (pizza place purchess)

[bhenken08]

what would you guys call fair value for a place
980sqft
In very good location (Northgate way) Seattle
Closed not running
Fresh remodel
includes everything (walk-in, Bakers Pride Oven, class one hood, pie board, )
the only thing it needs is food and owner
3k per month lease
no NNN
They want 90k 100% owner financed 9 years extra $900 per month

 

[gbomb]

What is NNN?

So they want 90k up front and then $900 a month for nine years? on top of 3k a month rent? 980 sq ft is a little small. is this in a busy downtown area? doing a lot of slices maybe?

 

[bhenken08]

well so heres the story. (im told) the owner and his partner are both elderly and had very inconsistent hours and days they were open.

they built this business about a year ago and paid for the ten year lease upfront.

so now their is 9 years left on the lease (1700 pm)
and they want to sell all of the equipment (1200pm)(9year term)

so they want 3,000 per month which will include the mortgage payment and the rent ( i would have to pay electric and gas)

yes this is one of the most busy areas of Seattle

 

[bodegahwy]

This could work out to be a very good deal or a very strange bad one.

The place is less than a year old and is closed. There is NO business value.

The value that exists is the market price for used equipment plus a small premium for the fact that it is already in place. Most likely, this number looks more like 30K than the 129K the payment plan adds up to. Unfortunate? Yes. That is reality. It might be worth paying somewhat more to have it all in place but the equipment you describe (ovens, walkin, etc) would not justify it.

I am confused by your reference to a mortgage. If this is lease there is no mortgage involved. Paid a 10 year lease in advance? Tell me another one.

Have an attorney look at the lease.

gbomb, NNN = triple net expenses.

 

[pizzafanatic]

bhenken08:

and they want to sell all of the equipment (1200pm)(9year term)

Something smells fishy with this. Maybe it’s just downwind from Pike’s Market.

$1200 per month X 12 months X 9 years = $129,600 Wow! This equipment only has 4 more years left of depreciated value. There’s no way it’s worth $129K

 

[15thStreetPizzaandPu]

bhenken08:

the only thing it needs is food and owner

Don’t count on that! New owner means new rules for fire department, health department, code enforcement.

If it has been closed for a year you will have to bring it up to code before opening…