Our friends at Savills have written a short article which will help you to answer any queries you may have if you have thought about selling your holiday or residential park.
There are a number of points to consider prior to offering your park for sale. Firstly, it is important to make sure that your business is presented in its best possible light. Whilst the physical appearance of the park is significant, it is also important to make sure that your accounts are presented in the correct form. It is advisable to ask your accountant to prepare three years of abridged accounts, excluding items such as depreciation and your own personal/finance costs. It is also a good idea to highlight within the accounts any significant ‘one off’ expenditures that may have occurred during this financial period such as a new sewerage treatment plant or refurbishment of a toilet block. This will enable a purchaser to glean a clear understanding of the annual running costs for the business moving forward.
Another common running cost that can vary considerably depending on management style are staffing costs. Should you currently run your business predominately under management, a breakdown of staff and associated job descriptions can be very useful to a purchaser. Should they choose to increase or decrease the staffing levels, they can estimate the reflection this will have on the future trading potential of the business.
Secondly, we would recommend that from the outset of the sale process you have all the necessary documentation that a buyer will require to hand. Often minor issues regarding land title, planning and site licence issues can cause lengthy delays to the sale process if they are highlighted once a sale has been agreed. Other items such as current electrical and discharge certificates for sewerage treatment plants are also important to have to hand. This ensures that the sales process runs as smoothly as possible and gives you the opportunity to highlight any potential issues prior to going to market.
Maximising the value of your park
Thirdly, it is most important to ensure that you have established the true potential of your park. This will involve reviewing all existing planning permissions etc and establishing if there is any future development potential for the site within your existing consents. If so, it is important to draw reference to these in any marketing literature that is produced. The majority of buyers want to purchase a business that is both profitably trading in its current form, as well as having some future potential for expansion. Highlighting the potential areas for future expansion and development makes a business more attractive to both buyers and their finance providers.
Speak to the experts
To ensure that you achieve the maximum price for your business it is vital to seek advice from professionals within the industry from the outset. Savills has three teams located throughout the UK who specialise in the valuation and sale of holiday and residential mobile home parks.
Should you wish to discuss any element of the potential sale of your business with one of the Savills Leisure South West team then please contact either Robert Gale-Hesleham or Chris Sweeney on 01392 455794.