Property Management · Tenant Planet
A Southern California property management firm, sold at the top of its range
Eight hundred doors, a decade of operating history, and an owner ready for the next chapter. A run process produced a result 25% above the unsolicited offer that started the conversation.
Deal breakdown
- Business type
- Residential property management
- Location
- Southern California
- Years in operation
- 10
- Annual revenue
- $1.9M
- SDE
- $613K
- Doors managed
- 800
- Staff size
- 24, including the sellers
- Ownership structure
- LLC
- From launch to wire
- 172 days
The challenge
The owners had built a thriving regional property management company and were ready to focus on the next chapter. Margins were strong and the recurring revenue from more than 800 managed units was real, but churn had risen in recent years and the firm was managing fewer units than it had been.
Key pain points
- No prior valuation and no exit planning
- Fragmented bookkeeping and client data
- A reduction in total units under management
- An unassignable lease at the main office location
Phase one
Preparation
We began with a sell-ability assessment, identifying what would create friction in a deal and what could be resolved before a buyer ever saw it.
- Recast three years of financials, normalizing owner expenses
- Built a unit rationalization breakdown analyzing growth, churn, type, and profitability per unit, so a buyer could understand the door count rather than guess at it
- Produced a preliminary valuation positioning the firm in a 1 to 1.5x revenue multiple range
Phase two
Targeted marketing and buyer outreach
The go-to-market strategy focused on three buyer profiles: regional roll-ups and consolidators, private-equity-backed platforms, and buyers already known to the business.
- A confidential teaser written to attract interest across all three buyer types
- A confidential information memorandum built for strategic buyers
- Outreach through our own network of active acquirers in property management
- An NDA-gated process, so only serious parties reached real information
- Eight buyer conversations within 30 days, with no public marketing
- Three letters of intent submitted, and two strategic buyers entering exclusivity
Phase three
Negotiation and closing
Price matters, but it is not the only term that decides whether an exit is a good one. We negotiated on likelihood to close, cash versus deferred payment, transition requirements, and fit for the business.
- Valuation at the top end of the range
- A four-week transition period
- No earnout required
The outcome
- For the seller
- A full exit at the high end of the valuation range, with minimal seller financing and a short transition period.
- What the process added
- The closing valuation was 25% higher than the unsolicited offer the owners had received before engaging us.
These figures describe this engagement. They are not a benchmark, a range to expect, or a promise about any other business. What a company sells for depends on that company.
More on how we work in property management, or how a sale runs end to end.
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