Buying/selling coworking spaces

Does anyone have experience buying or selling an existing space? I’m sure this is something we’ll all run into at some point.

Hypothetically - say someone got an offer out of the blue to buy your business outright and you’re considering it - what’s your first course of action? Do you get a professional assessment? Do you get a lawyer to package your company for sale and write up a contract? Is it worth going through a listing agent to find other potential buyers?

LMK!

Hi. From what I was told for our kind of business, you use a 3-5x multiplier on your annual net earnings, or EBITDA.
Closer to 5 or even 6x if you have many years on your lease or somehow have some other premium (location, strong community, etc.)

WW is like infinityX btw, like 1000x future P/E ratio.

You could engage a lawyer, but honestly, most lawyers rarely given you biz advice. A biz dev person, or broker…or YOURSELF would package up a deal. The lawyer would draft up a PSA, purchase sellers agreement, based on YOUR direction.

JEROME CHANG

talk to us: (323) 330-9505

chat w/ us: http://www.BLANKSPACES.com/chat

WEST: Santa Monica | 1450 2nd St (@Broadway)

CENTRAL: Mid-Wilshire | 5405 Wilshire Blvd (2 blocks west of La Brea)

EAST: Downtown | 529 S. Broadway, Ste 4000 (@Pershing Square)

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On May 30, 2017, at 10:49 AM, David Hamilton [email protected] wrote:

Does anyone have experience buying or selling an existing space? I’m sure this is something we’ll all run into at some point.

Hypothetically - say someone got an offer out of the blue to buy your business outright and you’re considering it - what’s your first course of action? Do you get a professional assessment? Do you get a lawyer to package your company for sale and write up a contract? Is it worth going through a listing agent to find other potential buyers?

LMK!

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Ramón Suárez might be willing to pitch in here, his space in Brussels was recently acquired by some of the coworkers -- this approach may not yield as high a return as selling to a developer of somesort though surely better preserves the community, and without leaving them feeling like they've been taken advantage of :wink:

http://www.lecho.be/dossier/startups/Le-Betacowork-change-de-mains-l-esprit-reste/9890321
(in French, Google Translate doesn't work with this site…)

···

On 30 May 2017, at 7:49 pm, David Hamilton <[email protected]> wrote:

Does anyone have experience buying or selling an existing space? I'm sure this is something we'll all run into at some point.

Hypothetically - say someone got an offer out of the blue to buy your business outright and you're considering it - what's your first course of action? Do you get a professional assessment? Do you get a lawyer to package your company for sale and write up a contract? Is it worth going through a listing agent to find other potential buyers?

LMK!

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I didn’t know Beta was sold to members! That’s great news :slight_smile: congrats to Ramon & your crew.

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On Thu, Jun 1, 2017 at 5:27 AM, Jacob Jay [email protected] wrote:

Ramón Suárez might be willing to pitch in here, his space in Brussels was recently acquired by some of the coworkers – this approach may not yield as high a return as selling to a developer of somesort though surely better preserves the community, and without leaving them feeling like they’ve been taken advantage of :wink:

http://www.lecho.be/dossier/startups/Le-Betacowork-change-de-mains-l-esprit-reste/9890321

(in French, Google Translate doesn’t work with this site…)

https://www.coworkinghandbook.com/ive-sold-betacowork-great-coworking-future/

On 30 May 2017, at 7:49 pm, David Hamilton [email protected] wrote:

Does anyone have experience buying or selling an existing space? I’m sure this is something we’ll all run into at some point.

Hypothetically - say someone got an offer out of the blue to buy your business outright and you’re considering it - what’s your first course of action? Do you get a professional assessment? Do you get a lawyer to package your company for sale and write up a contract? Is it worth going through a listing agent to find other potential buyers?

LMK!

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The #1 mistake in community building is doing it by yourself.

Better Coworkers: http://indyhall.org

Weekly Coworking Tips: http://coworkingweekly.com

My Audiobook: https://theindyhallway.com/ten

This was brought up at GCUC 2019. There was also a new fund announced that want to help existing spaces grow through a joint venture partnership.They have money to spend and will likely start approaching small chains of spaces.

The sad news is that a lot of us in coworking simply don’t know how to value our spaces. We might want to exit to move on to new projects, we might need the cash, or we might not know where to go when we want to grow. We might get excited by ANY buy out or might get offended with something that seems low. We just don’t know how to evaluate our business.

There were four spaces in Denver that transferred ownership, closed, or got acquired by a existing coworking chain in the last 9 months. Some cashed out, other just wanted to move on, and some couldn’t make it work out financially.

I have a member and friend at my space that works in business acquisition. He seems interested in putting something together for us and will have it ready by the end of the month. Stay tuned.

I have had experience on both sides of buying and selling coworking spaces, but some of my learnings are currently covered by confidentiality agreements.

If anyone has questions about this then feel free to reach out to me directly, I am happy to share what I can.

Carl

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You’ve been pinged. :slight_smile: