Thursday, February 11, 2010

Business update

I realized that some of my favorite people have no idea what's going on lately because I haven't said anything on here, nor have I posted anything about it on Facebook. I'm being kind of quiet about the whole thing because I don't want to jinx it and have a lot of questions until the contract is signed and everything is set, but for you guys I'll make an exception.

So a little over a month ago I decided it was time to sign up with a new Realtor. The day or two before I planned on setting an appointment with the new guy I ran into a fellow business owner at my other job. He asked how things were going and I told him my business was up for sale and so on and he said if he had the money he would want to buy it. He didn't really ask about the price or anything so at the time I just let it go at that.

For the next day or so it was eating at me because his business would be a really good fit for this place and I decided to take a risk and typed up a two page email/proposal to him to purchase the building without Realtors to save everyone involved some money. I didn't think he'd go for it, but I thought I would take a shot at it. Well the very next day he said he would be very interested and asked if he could have a couple of weeks to explore the possibility.

Well we met a couple of times for him to look around and such, and then he asked for sales figures and profit and loss statements, then he met with the bank who turned him on to a secondary source of financing for the down payment money and next thing I know we're at this week when he discovered his proposal was approved. So now that the secondary source has been approved the bank will approve his funding on the condition that the appraisal comes back at the agreed amount or more. So the bank is supposed to be scheduling the appraisal soon.

So where does that leave us? Well I'll tell you.

Once the appraisal is complete we will know if the place is worth what we agreed on and if it is and assuming he doesn't back out on me then we can meet with the lawyer to draw up the final contract for the bank. Then the bank can do it's final approval, we can start the liquor license transfer and he can close on the loan and I can get my check after the loans are paid off. Then I can begin the process of closing my business and packing up.

If the appraisal comes back under the amount we agreed on then we will have to negotiate the price again and assuming it's not under what I owe we can strike a deal and I can still get out of here.

I am very worried about the appraisal because I have no idea what the market has done to the value of this building. It has to be done based on the comps and many of the comps used for the original appraisal that I had done in November of '05 can no longer be used. The only thing that keeps me positive is the fact that this place appraised then at what we just agreed on. When I bought the place it was nearly condemned, I couldn't get replacement coverage on my insurance because of the condition of the building. The electrical was a mess, the plumbing falling apart and the roof leaked all over the store. The first rain storm we had I counted 27 buckets out in the store and there were some we couldn't get to, and it had no income except a measly $30k in sales. Now I have three full rentals of very secure renters that pay 3 x's the mortgage, plus the house is in a shape to be rented. Not to mention I've had sales over 100k each year I was open full time, and even at one day a week I have a projection of $50k in sales for the year. Even after closing to one day a week in August the business still profited over 5k last year, which isn't a lot but I was also remodeling and digging myself out of a mountain of debt. Not to mention that the house across the street, a house mind you, sold for 5k over what I'm asking for this place and it's foundation had to be rebuilt.

So while I have some confidence, I'm also worried because that's just how I am. If we get to the point of signing that contract and he's under contract to buy, then I will get excited. Until that point though, I remain skeptical and not making any plans for the future. I'm ready for this to be over because this month has been a financial disaster and more looms in the future, so the sooner the better. I'm also just ready to move on with my life, to move on to new challenges and just see what's out there.

So there's the update that I'm sure a few of you didn't know about. I still won't post much on facebook until we get to the contract. I know he's been talking to a lot of people that he's taking over because they are asking me about it and I have only told 7 people, so he's really making plans, I'm just hoping he doesn't get spooked and abandon the plan.

well that's it. I'm going to take some meds and go to bed because I'm afraid I may be getting sick. Later!

2 comments:

  1. Meanwhile in Cincinnati....Bethany is losing her shit with excitement.

    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod
    OhMyGod

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  2. I'm very excited for you! I also hope he doesn't back out, but you can cross that bridge when you get to it.

    The good thing is, you already have a place lined up, so moving out on notice won't be too bad.

    Miss you!

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