Selling a Florida Business That Owns Its Real Estate in 2026

If you own a Florida HVAC company, machine shop, distribution business, or medical practice, there is a good chance you also own the building it operates out of. For owners in the $3M to $50M revenue range, that building is often the largest single line on the personal balance sheet. It is also the item most commonly mispriced when the business sells. The error is treating it as one asset. It is two. You own an operating company and you own a piece of commercial real estate. They attract different buyers, they are valued on completely different math, and they close under different documents. Owners who sell them as a single bundled package routinely leave money on the table, because the buyer who wants your business is rarely the buyer who will pay the most for your dirt. Here is how to separate the two, what Florida buyers and lenders will actually accept, and the sequence that gets both assets paid for properly. ## You Own Two Assets, Not One Start by splitting the valuation in your own head before anyone makes you an offer. - **The operating company** — valued as a multiple of normalized earnings. Seller's discretionary earnings for smaller businesses, EBITDA once earnings clear roughly $1.5M to $2M. - **The real estate** — valued on the income it produces as a leased asset, capitalized at a market rate, or on comparable sales per square foot. Whichever number a lender will support is the one that governs. The two valuations are connected by one line item: rent. If your company occupies your building rent-free or at a below-market rate, your profit and loss statement overstates earnings. Every competent buyer's analyst will normalize that rent to market before applying a multiple. If you have not done it first, you will find out about it in the middle of diligence, which is the worst possible time to re-trade your own price. ### An illustration of the rent adjustment Take a company reporting $2,000,000 of EBITDA that pays no rent because the owner holds the 20,000 square foot building in a separate LLC. Market rent for that space is $180,000 per year. - Normalized EBITDA becomes $1,820,000. - At a 5.0x multiple, the rent adjustment reduces enterprise value by roughly $900,000. - But the building, now leased at $180,000 of net operating income, is worth approximately $2,570,000 at a 7% capitalization rate. The owner who understood this walked into the deal with two priced assets. The owner who did not walked in expecting $10,000,000 for the business and got a $900,000 haircut explained to them in week six of due diligence. The figures above are illustrative, not a quote, and the real numbers depend on your market, building class, and lease terms. ## Three Ways to Handle the Building There is no single correct answer. There is a correct answer for your situation, your tax position, and whether you want to keep an income stream after closing.

Structure	What happens	Best when	Main trade-off
Sell business and real estate together	One buyer acquires both; single closing, single price	The property is special-purpose, the buyer is a strategic that needs the location, or you want a clean full exit	You are paid an operating-business multiple on an asset that an investor may value higher
Sell the business, keep the building, lease it to the buyer	Buyer signs a long-term lease; you become the landlord	You want post-closing income and are comfortable holding Florida commercial property	You stay exposed to insurance, taxes, and tenant performance
Sell the business, then sell the building separately	Business goes to an operator; leased building goes to a real estate investor	The property is generic industrial, retail, or office that trades on cap rate	Two transactions, two sets of costs, and the lease must be signed before the property is marketed

In practice, the third path produces the highest combined proceeds more often than owners expect, particularly for standard industrial and flex space in Tampa, Orlando, Jacksonville, and the Fort Lauderdale to Palm Beach corridor. A stabilized single-tenant building with a creditworthy tenant and ten years of term is a product institutional buyers compete for. The same building, sold vacant or bundled into a business sale, is not. ## The Sale-Leaseback, Explained Plainly A sale-leaseback means you sell the building to an investor and simultaneously sign a lease committing the operating company to occupy it. The investor is buying an income stream, not a building. Three variables drive what they will pay: - **Rent** — too low and you leave value behind; too high and you have loaded the operating company with an expense that depresses its own multiple. Set it at defensible market rent, supported by an appraisal or a broker's rent comparables. - **Term** — ten to fifteen years with renewal options is standard. Shorter term, higher cap rate, lower price. - **Credit** — the stronger the tenant, the tighter the cap rate. After a business sale, that tenant is the buyer, which is why the lease is negotiated as part of the deal and not after it. One warning. If you set rent above market to inflate the building's value, you are financing that gain out of the operating company's earnings, and the business buyer's analyst will see it. You cannot sell the same dollar twice. ## Writing a Lease a Buyer and a Lender Will Accept The lease is the hinge of the whole transaction. If you are keeping the building, these are the terms that will be fought over. - **Triple net versus gross** — triple net is the Florida norm for industrial and flex, and it matters more here than in most states because the tenant absorbs windstorm insurance and property tax increases. - **Rent escalators** — 2% to 3% annually, or CPI with a cap, is typical. A flat ten-year rent erodes the asset's value. - **Assignment and change of control** — the buyer will insist on the right to assign the lease if they later sell the business. Expect it, and negotiate a reasonable consent standard rather than a flat prohibition. - **Personal guarantee** — the buyer's entity may be newly formed with no operating history. A guarantee or a security deposit is reasonable, and your lender will likely require it if there is a mortgage on the property. - **Deferred maintenance** — roof, HVAC, and parking lot condition get negotiated explicitly. A buyer who inherits a roof two years from replacement will price it. If a bank is financing the acquisition, the lease term generally needs to equal or exceed the loan term. SBA 7(a) acquisition loans in particular will not fund against a short lease on owner-related property, and the lease must be at or below market rent for the deal to be credit-approved. ## Florida-Specific Items That Catch Owners Off Guard Florida has no personal income tax, which is a genuine advantage at closing. It is not the whole picture. - **Documentary stamp tax on the deed** — $0.70 per $100 of consideration statewide, with Miami-Dade at $0.60 per $100 plus a surtax on non-single-family property. On a $2,500,000 building, that is roughly $17,500 in Florida's doc stamps, and the contract decides who pays it. - **Note and mortgage stamps** — $0.35 per $100 on the note, plus intangible tax of 2 mills on the mortgage amount, if the buyer is financing. - **Property tax reset** — the assessment resets to just value on transfer. Your current tax bill may reflect years of capped increases. A buyer underwriting the real tax bill will come in lower than you expect if you quoted them your old number. - **Windstorm and flood insurance** — in coastal markets from Naples to Jacksonville, insurance is now a material underwriting line, not a rounding error. Get a current quote in the buyer's name before you set net rent. - **Environmental** — any site with a history of vehicle maintenance, chemical storage, dry cleaning, or fuel tanks should expect a Phase I environmental site assessment. Order it early. A surprise Phase II in week eight kills momentum. Confirm the tax treatment of your specific structure with your CPA and real estate counsel before you commit to an allocation. Whether the building sits inside the operating entity or in a separate LLC changes the answer materially, and that structure is far easier to fix twelve months before a sale than during one. ## Sequencing: What to Do and When The order of operations matters more than any single term. - Twelve months out, get the building appraised and get a market rent study. Separate the real estate from the operating entity if it is not already separate. - Nine months out, normalize your financials to show market rent as an expense, so your earnings are presented on the same basis a buyer will underwrite. - Market the business with the real estate treated as optional. Let buyers tell you whether they want to buy or lease. - Negotiate the lease inside the business purchase agreement, not afterward. - Only after the lease is signed and the business has closed should the leased building go to the investor market, if that is the path you chose. ## Frequently Asked Questions ### Should I sell the building to the business buyer or to an investor? Compare the two offers on an after-tax basis, not a headline basis. Business buyers often want the property to control their occupancy cost and will pay fair value, but they are rarely the highest bidder. If the building is generic and leasable, a real estate investor buying stabilized income usually pays more. If it is special-purpose and unleasable to anyone else, the business buyer is effectively your only market. ### Does keeping the building make my business harder to sell? No, as long as the lease terms are reasonable and documented early. What makes a business harder to sell is an undefined occupancy situation. A buyer cannot model a business whose rent is unknown and whose landlord is the seller they are negotiating against. ### How does rent affect my business valuation? Directly. Rent is an operating expense, so every dollar of rent reduces EBITDA by a dollar and reduces enterprise value by roughly the multiple. That is why rent should be set at genuine market, documented by a third party, and disclosed in your financial presentation from the start. ### Can an SBA loan finance both the business and the real estate? Often yes. SBA 7(a) can finance a business acquisition together with the owner-occupied real estate it operates from, and the real estate portion typically carries a longer amortization. The structure has to be set up properly and the appraisal has to support the allocation, so involve the lender before the purchase agreement is drafted, not after. ### What if my building is worth more than my business? It happens, especially with older industrial and retail property in markets that have appreciated hard. If that is your situation, you are running a real estate hold with a business attached, and the exit should be planned that way. The sequencing changes, and so does the buyer you should be talking to first. ## Get Both Assets Priced Before You Go to Market The owners who do best in this situation are the ones who knew what each asset was worth before a buyer told them. CBH Business Group has advised on Florida transactions across HVAC, construction, manufacturing, healthcare, and professional services, and the real estate question comes up in the majority of them. We have been named to the Top 50 Brokers in Florida for 2024 and 2025 and were the number one top dollar producer in Central Florida in 2025. Start with a free valuation of the operating company at https://cbhbusinessgroup.com/valuation-calculator so you know your earnings baseline on a market-rent basis. Then book a confidential conversation with Jesse Hastings at https://calendly.com/jesse-cbhadvisory or call (407) 908-3845, and we will walk through which of the three structures above actually fits your property, your tax position, and the timeline you have in mind.