Posted by Chris P on September 11, 2007 at 13:20:48:
The current owner wants a long term lease, 99 yrs. For this area and the size of one of the billboards I think the $12,000 is about right. He is selling the land for $599,000 (5+acres). I am thinking of separating out the value of the billboards (about $150,000)in the contract so I can depreciate it. I also want to reduce the price by some amount.
Posted by Chris P on September 10, 2007 at 13:46:50:
I am currently looking at a property that has 2 billboards on it. The current owner wants to keep control of the billboards and to lease back to him for $1. I am estimating they bring in about $12,000/year. What is the best way to make an offer? With an 8% cap they are worth $150,000.
Chris, don’t underestimate the value of billboards… Depending on what part of the country you are in, and what road these are located along, they can bring in quite a bit more than $12,000 a year…
Also, how long a lease does the current owner want for the billboards? You need to take that into consideration, too…