Opportunities
Architecture Firm for Education, Senior Living, and Tech Facilities
Sold
Selling at a 1.3 multiple with a 433% return on investment!
Specifications
Priced at $475,000, this Los Angeles architecture firm is selling at a 1.3 multiple with a 433% return on investment! With a team of highly skilled designers and architects with years of experience, this firm has fostered many relationships by designing spaces for children and seniors alike, and have maintained lasting connections with customers, yielding long-term contracts. They use top-notch software to create beautiful designs for educational institutions like colleges and K-12 schools, early childhood centers, senior living homes, and technical projects for communication or industrial companies. Due to their focus on universal and sustainable designs, their plans take into consideration the environmental impact of the design. The owners are dedicated to their work and both take on project management roles as well as business and financial management tasks. Due to one of the owners being ill, they will only be available to train for up to 6 months; however, the second owner can stay on for 2-3 years as negotiated.
The 3,000 square feet of space is well-suited to this company’s team. A welcoming reception area greets visitors while private offices, conference rooms, and large open drafting areas are tailored to the staff. The team of technical staff (8-9) and architects (2 owners and 2 contracted associates) are supported by the Office Manager and a bookkeeper.
Growth in the Los Angeles area is great. A focus on educational facilities alone could generate additional contracts for long-term development and modernization projects. Working for entities with bonded projects is also an area for sustained work as these funds are less susceptible to economic fluctuations.
Business Highlights
Year Established:1994
Location: Los Angeles, California
Services: Design-build, facility design and planning, sustainable design, universal design, modernizations, new builds
Clients: Education facilities (75%), technical facilities, senior housing, child development centers, commercial properties
Lease: 3,000 sq. ft.: Reception, private offices, conference room, large open drafting areas
Reason for Selling: Owner 1 has an illness. Owner 2 is planning to retire.
Personnel: 15: Office manager, PT bookkeeper, technical staff, contracted associate architects
Seller Training Period: Owner 1 will stay on up to 6 months. Owner 2 will stay on 2-3 years, as negotiated
Growth Opportunities: Expand work in senior living and educational institutions, build focus on government projects, grow the customer base to include additional school districts
Current Owners’ Responsibilities: Project and financial management, business development
Financial Highlights
Cash Flow Analysis
| Description of Financial Statement | P&L Statement Jan 1 - April 8, 2021 (14 weeks) | P&L Statement Jan-Dec 2020 | Tax Return | Tax Return | Tax Return | Tax Return | Notes |
| 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | ||
| GROSS SALES | $761,415 | $2,240,328 | $2,446,044 | $4,164,082 | $2,605,252 | $2,292,207 | |
| Annualized | $2,828,113 | ||||||
| Net Income Shown on Financial Statement | $130,296 | $183,813 | $-1,668 | $876,163 | $226,994 | $237,994 | |
| ADDBACKS | |||||||
| Depreciation | $0 | $6,896 | $24,848 | $24,676 | $14,448 | $237,994 | |
| Interest | $27 | $13 | $0 | $0 | $15 | $0 | |
| Auto Expense | $832 | $326 | $757 | $1,913 | $1,270 | $1,287 | 10% is personal |
| Cell Phones | $513 | $2,052 | $2,052 | $2,052 | $2,052 | $2,052 | $171/month for personal lines |
| Dues & Subscriptions | $0 | $255 | $2,198 | $2,198 | $2,198 | $2,198 | $2,198 for rotary |
| Gifts | $0 | $1,555 | $1,272 | $1,718 | $551 | $1,476 | |
| Contributions/Donations | $200 | $15,920 | $0 | $0 | $0 | $0 | |
| Accrual to cash | $0 | $0 | $11,101 | $36,196 | $0 | $0 | |
| PPP Loan | $0 | $-200,000 | $ | $0 | $0 | $0 | |
| TOTAL ADDBACKS | $1,572 | $-172,983 | $42,228 | $68,753 | $20,534 | $245,007 | |
| Seller's Cash Flow = Total Addbacks + Net Income | $131,868 | $10,830 | $40,560 | $944,916 | $247,528 | $483,001 | |
| Annualized | |||||||
| Profit Margin | 17.32 % | 0.48 % | 1.66 % | 22.69 % | 9.50 % | 21.07 % |
- 2019 was the first bad year in 20 years (it was the first four months of the year).
- 2020 was down due to COVID.
- 2021 is on track to do nearly $500k in profit.
Clients
- Multi-family housing
- Education facilities
- Technical facilities
- Senior housing
- Child development centers
- Commercial properties
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
Services
- Design-build
- Facility design and planning
- Sustainable design
- Universal design
- Modernizations
- New builds
Personnel
Total personnel: 15
- Office manager
- Part-time bookkeeper
- Technical staff
- Contracted associate architects
Growth Opportunities
- Expand work in senior living and educational institutions
- Build focus on government projects
- Grow the customer base to include additional school districts
Valuation Details
Funding Example
Print, sign and send to:
210 N 78th St. 2nd FloorOmaha, NE 68114
Or fax to:
f 402.939.0857