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Napa Auto Parts And The Liquor Store Next Door

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Justin Haugen

Freshman Member
Joined
Apr 29, 2003
A liquor store and a Napa Auto Parts next door to each other that will be sold together.
Do I find comparables? If so, how?
Any advice on this will help.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
You apprasing the real estate or the business?
If you are appraising real estate, you'd compare with other retail buildings similar in size, location, etc. for the market and income approach. The monthly rent $$$$ is what counts more, not the tenant's retail use.
 

Walter Kirk

Senior Member
Joined
Jun 24, 2003
Professional Status
Licensed Appraiser
State
New Jersey
Assuming that you are appraising the real estate only the first question is are both stores on one parcel of land? If they are then you might want to look for multi tenant commercial buildings. If they aren't then you have sales of two properties in one transaction. Assuming that they can be sold seperately I would appraise each separately.
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
Look real carefully at the allowable use and zoning. I have seen areas where only a small area is zoned for liquor stores and as such command a much higher rent than the typical retail space. The GI to the business for a liquor store is significantly higher per SF than the typical small retail outlet due to the product, price per unit, etc. so a rental that includes a base and percentage based on profit can generate a much higher GI/NOI to the property owner than the auto parts store.

Good luck

Roger
 

Bill_FL

Senior Member
Joined
Aug 23, 2002
Professional Status
Certified General Appraiser
State
Florida
Kind of a neat mix. Fix yoru car in the parking lot of the Napa and down a few cold ones while doing so.

The above answers actually answer your question. Just had to make that comment.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I believe I would try to get sufficient income rental info to make an income adjustment. A NAPA store could be an owner-operator, but often Auto Zone, etc. are leased from absentee owners who were contracted to build the building and have favorable 5 year or better leases. I might try to find some auto parts stores like it and then add a contribution via income adjustment for the Liquor store. Most sales of Liquor stores, in my opinion, are affected by the gross sales...ie.-sell as a business that is difficult to seperate from the real estate.

Fix yoru car in the parking lot of the Napa and down a few cold ones while doing so.

Good way to promote the business. Name it Parts Store Liquors and then you can tell your wife you are going to run down to the parts store.
 

Walter Kirk

Senior Member
Joined
Jun 24, 2003
Professional Status
Licensed Appraiser
State
New Jersey
I should have mentioned this in my first answer. If you are located in a state with complicated liquor laws, like New Jersey, the fact that the property has an active liquor license may add considerable value to it.

In this area liquor licenses are limited by population as well as distances from schools and local regulations. If the subject property is the only legal location for a liquor store or a grandfathered use it is worth more money.
 
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