Buying a farm - valuation of storage containers
Discussion
I've agreed to buy a piece of land which includes several businesses operating from different buildings, yards etc.
To clarify, I am only buying the land and the buildings - the businesses that operate there are owned by others and only renting the yards and buildings from the current owner.
We agreed a price with all business owners wishing to stay on and renew their contracts.
A chunk of the business is storage, mainly 20 storage containers that are let @£150 per month.
When i first entered negotiations with the land owner, I was told by her that the storage containers belonged to her son and it would be between me and him to negotiate a price for me to buy them off him and keep them rented out to the current renters,
I met him at the weekend and he has asked for £150k for the 20 containers.
He also told me he buys them from the same supplier for £10k when he buys 4 together. Individually I think he said they were about £3k.
Obviously they are are set up, rented out on contracts, and are brining in £3000 per month, so I do understand that they're being sold as a going concern business, but £150k seemed high to me.
Does anyone here deal in this area, or have any opinions/advice on the asking price?
TIA
To clarify, I am only buying the land and the buildings - the businesses that operate there are owned by others and only renting the yards and buildings from the current owner.
We agreed a price with all business owners wishing to stay on and renew their contracts.
A chunk of the business is storage, mainly 20 storage containers that are let @£150 per month.
When i first entered negotiations with the land owner, I was told by her that the storage containers belonged to her son and it would be between me and him to negotiate a price for me to buy them off him and keep them rented out to the current renters,
I met him at the weekend and he has asked for £150k for the 20 containers.
He also told me he buys them from the same supplier for £10k when he buys 4 together. Individually I think he said they were about £3k.
Obviously they are are set up, rented out on contracts, and are brining in £3000 per month, so I do understand that they're being sold as a going concern business, but £150k seemed high to me.
Does anyone here deal in this area, or have any opinions/advice on the asking price?
TIA
Way too high.
If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
Geoffcapes said:
Way too high.
If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
Thanks mate, that's the kind of figure I was expecting from him.If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
I did want the containers part of the business, but renting the space back to him is an idea!
Best get my negotiating hat on.
Returningmember said:
Geoffcapes said:
Way too high.
If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
Thanks mate, that's the kind of figure I was expecting from him.If the business is not of interest, just tell him to collect the containers and put them elsewhere.
The business makes 36k a year, (before tax I'm guessing).
Rentals are rarely on long term fixed contracts.
I'd value it at 50k, and that's being generous.
Alternatively, work out a price for him to rent the land his containers are on for them to stay.
I did want the containers part of the business, but renting the space back to him is an idea!
Best get my negotiating hat on.
So he's probably had the storage as a nice passive income.
£50 a month per container (cash) makes a nice little sideline for you.
LimmerickLad said:
Returningmember said:
LimmerickLad said:
My thinking too
Hadn't even considered this idea, 
What size containers? Guessing most likely 20ft, but could be 40ft.
I have a number of them, last ones I bought a few weeks ago:
20ft prices
Used (low grade) £1150
One trip (like new) £2195
Delivery £350 (can fit 2 X 20ft or 1 X 40ft)
Moving them from site to site is a pain he won't want.
Would need to be a change of use planning permission if it is/was on agricultural land.
I have a number of them, last ones I bought a few weeks ago:
20ft prices
Used (low grade) £1150
One trip (like new) £2195
Delivery £350 (can fit 2 X 20ft or 1 X 40ft)
Moving them from site to site is a pain he won't want.
Would need to be a change of use planning permission if it is/was on agricultural land.
Mr Pointy said:
LimmerickLad said:
Returningmember said:
LimmerickLad said:
My thinking too
Hadn't even considered this idea, Make sure the termination terms are clearly defined if he does go for rental. At a future point in time you clearly have the option to terminate at which point the discussion changes to one about removing or selling.
If you rent the land to him, find a way in the contract to ensue that he’s the one exposed to any planning enforcement risk.
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