Key Statistics

Different Types of Sales

  1. Rent Roll Only – multipliers in the Sydney market have not moved too much in recent years. The average multiplier for a quality rent roll in the Sydney metropolitan area is $3.60 per $1 of property management commission only. Agencies pay from $3.30 to $4.00 being the highest multiplier.
    Quality drives price!

  2. Rent Roll & Office – as more agents reach retirement age the more agencies will want to sell their rent roll with the office as a walk in walk out leasehold or freehold.

  3. Sale of Shares – the most involved and comprehensive way of purchasing a rent roll. This will ensure a fixed and defined price for the vendor. These sales are normally strategic buyouts for all assets, business and rent roll of the company.

 

Rent sale prices

Business Goodwill

Rent rolls are easily valued or determined by a willing purchaser looking for extra income to help profitability, scale and growth seldom achieved by organic means in such a short period of time.

Goodwill comes at a price over and above the value of the rent roll.

mc rent roll broking has seen business goodwill values as little as $20,000 for an office and as high as $300,000 for a top performing property management and sales business. The question remains what are you buying or selling when asking for a value over and above the rent roll.

Rent sale prices

Size of Rent Roll

mc rent roll broking has been engaged in selling rent rolls anywhere from 30 properties under management to 720. Price has a bearing on size somewhat, however we have seen large rent rolls sell for over and above market prices.

What is constant, is that the pool of buyers shrink with larger rent rolls over and above 500, and the smaller the rent roll under 50 has less demand due to the same legal costs involved as if the sale were 500.

As the rent roll increases in size, profitability becomes increasingly important, so average income per property per annum should be the key driver of appetite for acquisition.

Rent sale prices

Retention & Transition is the Key

When buying or selling a rent roll, retention is so important for financial and reputational success. mc rent roll broking employs a detailed transition program in order to achieve the highest possible retention.

 

Communication to owners, scripts & dialogues through to compliance of newly signed agreements.

A high multiplier stands for nothing if considerable managements are not successfully transitioned across to the purchaser.

 

Rent sale prices