Business Valuation Blog | Understanding Buying / Selling a Company

How Does a Congregate Living Business Appraisal Work?

Posted by Business Valuation Specialists LLC on Jun 8, 2020 8:00:00 AM

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Whether you're creating an intentional community for families or an independent living apartment complex, knowing the value of your community can help you leverage that value for future expansions and improvements in your business. But how exactly do you calculate the value of your community? One way to get an accurate estimate of your community's value is through a congregate living business appraisal. But how does this type of business valuation work and what are the benefits you'll realize at the end of the process? Here's a quick look at how the overall process will go.

How Does a Congregate Living Business Appraisal Work?

As our world gets more and more connected, many people yearn for community and strong neighborhoods, while retiring seniors want a home where they can still enjoy their independence without feeling alone. Though many people focus on the congregate living community, the business behind it is just as important, with a great deal of forethought going into planning and activities to keep the community at the heart of the business thriving.

Knowing the financial value of that community provides your business with a basis for securing financing when it's time to expand, to fight bad tax assessments, to prove value for insurance claims and a wide range of other situations. It makes it easier to make smart decisions when you're considering making expansions to your community or getting into a different business model. The information helps you find places to improve your business, making it easier to make intelligent changes to your business.

The certified business appraiser will go over your company's finances, look at competitors, consider market forces and a wide range of other information to determine the overall value for your business. This information all feeds into a series of complex calculations that will arrive at a fair and accurate value of your business. An independent certified business appraiser will utilize accepted methodologies and approaches to value your business, whether the purpose is for potential purchase/sale, insurance, legal, financial or tax situations. The estimated value is supportable and will stand up to scrutiny.

Once this information has been fed into the appraiser's formulas, the research and analysis completed by the appraiser is then summarized in a certified report which can be presented to any third parties involved in the ongoing transaction as a supportable independent document. You can use the data within the report to spot areas where your business model is soft, where your community could be improved and a range of other purposes to help you build and grow your company. Many business owners use insights found within a business appraisal report for this purpose.

By understanding how a congregate living business appraisal works, you can get a better grasp on the overall value of your community, providing you with a solid tool for growth, improvement and expansion. However, it's of vital importance that you only work with a certified business appraiser through the process. By doing so, the valuation report you'll receive will have an estimated value that was calculated using standardized methodologies, providing you with a solid starting point for your business' future growth.

Topics: Congregate Living Facility Business Appraisal