Return To Opportunities List

Opportunities

Architecture Firm w/ Multiple Locations & 80 Professionals

Architecture, Interior Design & Landscape Architecture with 75% recurring clients!

CASH FLOW
$3,487,240

Specifications

  • Price
    $11,500,000

  • Revenue
    $18,945,163

  • Cash Flow
    $3,487,240

  • Account Receivable

  • Profit Margin
    18%

  • Employees
    80 employees including owners, who want to stay on under new ownership

  • Intangible Assets
    Strong client base through website and social media advertising & reviews

  • Location
    Pennsylvania

  • Service Area
    Pennsylvania, Delaware, New Jersey & Maryland

 

This firm has multiple locations with over 80 expert employees! Specializing in architecture, interior design, and landscape architecture, their highly skilled team includes a full-time business director, full-time marketing director, and a full-time public relations and social media associate. Their loyal client base is comprised of developers, contractors, and corporate end-users, as well as public and private institutions.  

 

Serving regionally in Pennsylvania, Delaware, New Jersey, and Maryland, the team secures around 200 projects per year, with 75-80% reoccurring clients. Their services include architecture (75%), interior design (15%), and landscape architecture (5). The firm is known for providing top-notch architecture and design services in the area for 47 years. 

 

There is immense growth potential for this company. A new owner could expand market share in healthcare and senior living. Opening an office in Pittsburgh or otherwise expanding the market into middle or western Pennsylvania is a growth opportunity as well.

 

Established In 1973, their gross sales have been increasing year over year with a profit margin of 18%. The owners are looking for an industry consolidation and are willing to roll equity up to 20% as well as stay on 2-8 years. 

 

Business Highlights

  • Year Established: 1973
  • Location: Multi-Location in Pennyslvania
  • Service Area: Pennsylvania, Delaware, New Jersey & Maryland
  • Clients: Developers, contractors, corporate end-users, public & private institutions
  • Services: Architecture, Interior Design & Landscape Architecture
  • Building: Site 1: 10,671 sq. ft.; Site 2: 5,842 sq. ft.; Site 3: 4,682 sq ft. (currently expanding)
  • Reason for Selling: Industry Consolidation 
  • Personnel: 80 Employees including owners, who will stay on under new ownership
  • Seller Training Period: 2+ years
  • Growth Opportunities: Expanding market share in healthcare and senior living; Opening new location in mid- or western PA.
  • Current Owner’s Responsibilities: Three owners serve as president, VP of marketing, and VP of operations; All owners also spend 40% of their time on billable work as architects or landscape architects

Financial Highlights

  • List Price: $11,500,000
  • Gross Sales:
    • 2020: $18,945,163 Annualized
    • 2019: $16,451,782
    • 2018: $17,745,051
    • 2017: $13,047,518
  • Cash Flow:
    • 2020: $3,487,240 Annualized
    • 2019: $2,935,924
    • 2018: $3,328,272
    • 2017: $1,392,709
  • Assets Included in Purchase*
    • A/R: $4,431,384

*amounts may vary, assets may be depreciated, replacement cost, or fair market value 

Cash Flow Analysis

Description of Financial StatementP&L Statement
June 19' - May 20'
P&L Statement
Jan-May 2020
P&L StatementTax ReturnTax ReturnNotes
TTM2020201920182017
GROSS SALES$18,299,452$7,893,818$16,451,782$17,745,051$13,047,518
Annualized$18,945,163
Net Income Shown on Financial Statement$2,721,406$1,410,446$2,871,856$3,281,356$1,359,013
ADDBACKS
Depreciation$39,507$0$39,507$3,912$3,774
Interest$7,946$4,347$8,349$24,404$11,322
Amortization$0$0$0$18,600$18,600
Contributions/Donations$13,256$3,625$16,212$0$0
Insurance Premiums for Owners: Health, Life, Auto$54,683$34,599$0$0$0
TOTAL ADDBACKS$115,392$42,571$64,068$46,916$33,696
Seller's Cash Flow = Total Addbacks + Net Income$2,836,798$1,453,017$2,935,924$3,328,272$1,392,709
Annualized
Profit Margin15.50 %18.41 %17.85 %18.76 %10.67 %
Profit Margin: 18%

Clients

  • Developers
  • Contractors
  • Corporate end-users
  • Public & Private Institutions

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

Services

  • Architecture
  • Interior Design
  • Landscape Architecture

Personnel

  • 80 employees (including 7 owners)
    • 3 owners serve as President, VP of Marketing, and VP of Operations

Growth Opportunities

  • Expand market share in healthcare and senior living
  • Open new location in middle or western Pennsylvania

Valuation Details

The Firm used a cash flow valuation methodology to determine the purchase price of the business. 

The formula used is as follows:

Cash Flow       x          Prescribed Multiple     =          Fair Market Value

Cash flow is the sum of business net income plus any owner perks and any non-onward going expenses.

A prescribed multiple is determined by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiplier.

For this business, a 3 year average cash flow was used with a prescribed multiple of 3.5.  With this information, the computation is as follows:

$3,250,479      x          3.5       =          $11,376,677

The fair market value found above positions the business list price at $11,500,000.

Attachments

Document Title / Description

This folder is empty.

Access to this Deal Room is restricted

Would you like to access the deal room?

Yes, please

Interested in
this business?

Complete the following information to sign an NDA and see more details!

Already have an account? Log in here.

Click to download NDA form

Print, sign and send to:

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

Or fax to:

f 402.939.0857

Thinking of Selling?
When selecting an M&A firm, please use the following Scorecard: click here for our M&A Scorecard


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.