June was a hot month for sales by Florida Business Broker, Russell Cohen and this Boca Raton Mall Restaurant was sold to an experienced, South Florida based,female entrepreneur and restauranteur, Severine Gualandi, who was ready to add more success to her business portfolio.
This restaurant known as the Bonaccino Cafe is located inside the Boca Town Center Mall . Bonaccino Cafe is considered a “fast casual” restaurant. You can find the Bonaccino Cafe near one of the retail anchor tenants Nordstroms. Fast casual restaurants often have sandwiches, salads, beverages and desserts and other menu items which are easy to prepare and not time consuming. Fast casual restaurants tend to be moderately priced vs higher priced fine dining.
Mall location rents are not for the faint of heart, especially in malls owned by the biggest landlords in the industry such as Simon Properties. When we asked the broker for this transaction about some of the things people should know about doing business inside a mall he said, “The buyer of a business inside a major mall typically needs to have a track record of success to get approved as a tenant in the mall.”
The seller of this business placed the restaurant on the market for sale with Russell Cohen, a Murphy Business Franchise Owner and Broker with the intention of making a quick sale to relocate out of the state of Florida for a business opportunity in California. Urgency was part of this sale. Initially, the price did not reflect this urgency.
There were many interested buyers for this business and the lesson learned from this business sale was that the foreign buyer with a higher price offer was considered a more risky tenant and could not get approved for the lease so the sale to this buyer could not happen.
At the end of the day, the best candidate for the purchase of this business was a local, female entrepreneur with experience in the restaurant industry. She had a strong enough cash position to make the purchase and the track record and credit to get approved for the lease — all required elements for this successful sales transaction.
Business owners who want to sell their companies should get help from professionals who can guide them on pricing the business fairly so they can make the sale within a reasonable amount of time to the right buyer.
The business took 9 months to sell since the listing price was $399k. The final sales price was $210K. Once the price had been dropped to a certain level the buyers began showing up and the deal then took place for the sale over a 30 day period.
Russell explains that when the price finally reaches an attractive number there are more buyers for the business. In this case, the buyer contributed almost 80 percent of the purchase price in cash and required only a small amount of financing to complete the transaction.The business selling price was $210K.
For the foreign buyer to be approved there would have been substantial additional deposits required as security for the lease agreement in the range of 6–12 additional months of rent. –
The business selling take away lesson from this sale was that if you are a seller and you need to sell your business, get advice from your business broker about pricing. If you get the business priced fairly from the beginning and you start to get other brokers who are co-brokering to begin bringing in buyers, you know it’s a matter of time and you’ll find the right buyer.
It is not uncommon for a non-US buyer to offer a higher price for a business purchase but with leases for commercial locations often requiring approval, they may not be able to qualify for the lease and this could definitely interfere with closing the business sales transaction.