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Home Remodels, Additions & Interior Design for Houston Real Estate Investors

Owner works part-time and does no field work!

CASH FLOW
$340,922

Specifications

  • Price
    $990,000

  • Revenue
    $2,138,675

  • Equipment
    $261,120

  • Down Payment
    12.5%

  • Location
    Houston, TX

  • Service Area
    Houston (70%), San Antonio (20%) and occasionally Dallas (10%)

  • Reason for Sale
    New non-competing endeavors

  • Employees
    12: PT Admin Assistant, PT Office Manager, PT Network IT, Operations Manager, Estimator, (2) Superintendents, Commercial Specialist, (2) Client Support, Document Control, Inside Sales and field crew

  • Intangible Assets
    Solid transferable relationships and communication with clients, adaptability working with larger businesses and corporate entities

The owner of this company works part-time and does no field work!  With an infrastructure set up to support larger clients and maintain relationships, a highly skilled staff of 12 is already in place and continues to build solid client relationships. Employees include 1 PT Admin Assistant, 1 PT Office Manager, 1 PT Network IT, an Operations Manager, 1 Residential Estimator, 2 Superintendents, 1 Commercial Specialist, 2 Client Support staff, 1 Document Control staff, 1 Inside Salesperson and 6-12 field crew employees. Clients include corporate real estate investors, private entities, and some residential work, along with commercial and military when needed.  The team works all over Texas, with 70% of their work being done in Houston, 20% in San Antonio, and 10% in Dallas. Services vary from complete home remodels and home additions, to maintenance, repair, and interior design. The owner’s position has been designed to be strictly part-time operations and financial work. 

 

Assets include $261k worth of equipment, $124k in vehicles, $180k in A/R, and $210k in work-in-progress.  The 4,200 sq. ft. warehouse, ½ acre equipment yard, and 2,500 sq. ft. office building currently used is available for sale or lease, separate from the sale of the business. 

 

Priced at $990,000, a down payment of $123,750 returns $214,318 in the first year after debt payments – a 173% return on investment! The current owner is willing to stay on for 6 months to 1 year, if desired. Growth opportunities include expanding into business to consumer residential projects as well as taking on more governmental commercial contracts.

Business Highlights

  • Year Established: 2004
  • Location: Houston, TX
  • Service Area: Houston (70%), San Antonio (20%) and occasionally Dallas (10%)
  • Services: Light Remodeling and Renovating
  • Clients: Large real estate investors, private entities, some residential, commercial and military
  • Building: 4,200 sq. ft. warehouse; 1/2-acre equipment yard; 2,500 sq. ft office building (3 offices, 15 workstations, conference rooms, etc.)
  • Reason for Selling: New non-competing endeavors
  • Employees: 12: PT Admin Assistant, PT Office Manager, PT Network IT, Operations Manager, Estimator, (2) Superintendents, Commercial Specialist, (2) Client Support, Document Control, Inside Sales and field crew
  • Hours: M-F 8-5
  • Seller Training Period: 6-12 months
  • Growth Opportunities: Take on more governmental commercial projects
  • Current Owner’s Responsibilities: Part time operations and financials; no field work

Financial Highlights

List Price: $990,000

  • 3-Year Average Cash Flow: $340,922
  • A/R: $180,000

Cash Flow

Description of Financial StatementP&L Statement
Jan-Dec 2020
Tax Return
Total
Tax Return
Total
Tax Return
Total
Tax Return
Total
Notes
20202019201820172016
GROSS SALES$2,138,675$2,442,221$2,115,793$1,804,951$2,405,220
Net Income Shown on Financial Statement$-13,035$29,868$-235,826$-18,837$14,653
ADDBACKS
Compensation to Owner$91,423$97,000$97,000$97,000$97,000
Other unrelated Salaries$0$12,000$18,000$18,000$18,000Family members - don't actually work in the business
11% Tax on total W2 Salaries$10,057$11,990$12,650$12,650$12,650
Depreciation$0$7,474$97,457$7,657$11,940
Interest$9,487$42,778$11,251$8,848$6,969
Auto-Personal Use$15,000$40,129$8,508$8,508$8,508
Meals & Entertainment$2,118$1,503$2,032$788$1,48570% personal
Cell Phones$4,200$4,200$4,200$4,200$4,200Cell Phones- $350/month for 4 personal lines
Travel$18,000$21,791$23,920$4,055$14,73290% personal
Insurance$15,622$8,343$11,644$11,644$11,644
Amortization$0$31,656$31,658$31,657$31,656
Contributions/Donations$1,825$3,193$1,606$1,584$0
Employee Benefit Plan$3,718$5,881$18,149$11,454$0Paid for owner & family
Management fees$0$116,966$251,972$194,242$140,302
MBA Program $0$0$4,728$0$0
FR Assoc Deferred Payments $0$0$24,285$25,790$10,643
Training & Education$40,000$0$0$0$0
Medical$4,006$0$0$0$0
Retirement Expense$2,339$0$0$0$0
TOTAL ADDBACKS$217,795$404,904$619,060$438,077$369,729
Seller's Cash Flow = Total Addbacks + Net Income$204,760$434,772$383,234$419,240$384,382
Profit Margin9.57 %17.80 %18.11 %23.23 %15.98 %
2020 numbers down due to COVID. The Firm used a 3-year average cash flow to value the business. 

Typical Clients

  • Real estate investors
  • REITs
  • Private entities
  • Residential projects
  • Governmental commercial contracts

Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.

Services

  • Complete home remodels
  • Home additions
  • Roofing
  • Concrete projects including foundations, driveways, flat work, etc.
  • Interior design
  • Maintenance and repairs

Service Area

Employees

  • PT Admin Assistant
  • PT Office Manager
  • PT Network IT
  • Operations Manager
  • 1 Estimator
  • (2) Superintendents
  • Commercial Specialist
  • (2) Client Support
  • Document Control
  • Inside Sales
  • Field crew

Growth Opportunities

  • Expand into business to consumer residential projects
  • Take on more governmental commercial contracts

Valuation

Funding Example

Purchase Price:

$990,000

$
%
OR
$
%
OR
$
Years
%

Bank Loan Needed: $

Years
%
$
$
$
$
$

Funding Details

Business:

Offer Price: $

% Buyer Cash Down at Closing: $

% Seller Carry Back via Promissory Note: $

year term at a rate of %

% of Purchase Price secured by Buyer and Seller

Total Bank Loan Need: $

% of Purchase Price

Desired Loan Type:

Desired Bank Terms: year term at a rate of %

Total Business Assets, Inventory, and A/R: $

Total Undercollateralized Loan: $

Loan Payments

Monthly Payment to Bank: $
Yearly Payment to Bank: $
Monthly Payment to Seller: $
Yearly Payment to Seller: $
Total Monthly Debt Service: $
Total Yearly Debt Service: $

Conclusions

Fixed Charge Coverage Ratio

The bank will require a minimum ratio of 1.5 to be lendable.

Cash Flow:
3-year average cash flow
$
Annual Debt Service: $
RATIO:

Buyer's Net Operating Income (NOI)

The amount of money the Buyer will retain as profit.

Cash Flow:
3-year average cash flow
$
Annual Debt Service: -$
NOI:

Buyer's Return on Investment (ROI)

The rate of return on the Buyer's down payment.

Down Payment: $
NOI:
ROI: %

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210 N 78th St. 2nd Floor
Omaha, NE 68114

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The Firm is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.