The Facilities Audit - How Deferred Maintenance Costs Affect Your Business Valuation

A buyer’s engineer stood in a client’s loading dock, notepad in hand, photographing the crack in the concrete floor that had been there for three years. What the owner considered a minor cosmetic issue, the buyer’s team flagged as a potential foundation concern requiring engineering assessment, and their preliminary estimate ran six figures higher than our client’s own contractor quotes. This gap between seller’s reality and buyer’s perception is the crux of facility valuation dynamics: in facility-dependent businesses, what you’ve learned to work around often becomes negotiating leverage used against you.

Executive Summary

For manufacturing, distribution, food processing, and other facility-dependent businesses, particularly those in the $5M-$50M revenue range, the physical condition of your plant represents a significant and frequently overlooked factor in business valuation. Deferred maintenance, those repairs and upgrades you’ve postponed to preserve cash flow, doesn’t disappear when you list your business for sale. Instead, it typically becomes a line-item in purchase price negotiations, often at estimates that include substantial contingencies and risk premiums.

In our M&A advisory practice working with facility-dependent businesses over the past decade, we’ve observed buyer repair estimates that frequently exceed actual market repair costs by 30-60%, reflecting uncertainty about scope, conservative assumptions about unknown conditions, and buyers’ natural incentive to reduce purchase price. The magnitude varies considerably by repair category, facility condition, buyer sophistication, and market dynamics, but the pattern is consistent enough to warrant proactive attention.

Buyers conducting rigorous due diligence on facility-dependent businesses typically scrutinize major systems: roofing, HVAC equipment, electrical infrastructure, flooring, loading docks, and specialized production equipment. Their engineers and facility assessors approach this review with a fundamentally different perspective than you do as an operator. Where you see a functional workaround developed over years, they may see potential liability requiring capital reserves. Where you see equipment that still performs adequately, they see capital expenditure requirements within their planned holding period.

A note before we proceed: Comprehensive facility rehabilitation is rarely optimal before sale. Strategic investment in selected high-impact items typically delivers better returns than attempting to address everything. This article will help you identify which investments warrant attention and which may be better handled through documentation and negotiation.

This article examines how facility condition affects valuation in facility-dependent businesses, identifies common deferred maintenance issues that trigger buyer concerns, and provides actionable frameworks for addressing these concerns strategically. Whether you’re three years or three months from a potential exit, understanding the facilities audit process positions you to protect your valuation and maintain more control of the negotiation narrative.

Introduction

Every business owner who operates from a physical facility makes ongoing decisions about maintenance, repairs, and capital improvements. When cash flow tightens or other priorities compete for resources, facility maintenance often moves down the priority list. The roof that needs attention can wait another year. The HVAC system that requires replacement can be patched again. The warehouse floor showing wear can be worked around rather than resurfaced.

These decisions make operational sense in the moment. Your team adapts, processes adjust, and the business continues to function. From an operational perspective, you’ve made a reasonable trade-off between immediate capital preservation and future maintenance requirements.

But when you begin preparing for an exit, the accumulated impact of these deferred maintenance decisions becomes suddenly visible and potentially problematic. Buyers approaching your business with fresh eyes don’t see the adaptations and workarounds you’ve implemented. They see a facility that may require capital investment before, during, or immediately after acquisition.

Different buyers evaluate facility condition differently. A strategic buyer within your industry, operating a similar facility, may be more forgiving of deferred maintenance they’re familiar with managing. A financial buyer or a buyer planning significant operational changes will typically scrutinize facility condition more rigorously. The intensity of facility assessment varies with buyer sophistication, their planned hold period, current market conditions, and how central the physical plant is to business operations. In hot markets with multiple competing buyers, facility issues may receive less scrutiny than in buyer’s markets where leverage shifts.

More critically, buyers approach facility assessment with a different calculus than you apply as an operator. They’re not evaluating whether the facility works for your current operations. They’re evaluating what investment they’ll need to make the facility work for their intended operations, often over a holding period of five to ten years. This longer time horizon means they may identify maintenance requirements you might reasonably defer for several more years as near-term capital needs from their perspective.

The result in many deals: deferred maintenance becomes a factor in valuation discussions, potentially reducing purchase price offers by amounts that exceed the actual cost of addressing the maintenance issues. Understanding this dynamic and taking strategic action where appropriate can protect meaningful transaction value.

What Buyers See When They Walk Your Facility

When a prospective buyer tours your manufacturing plant, distribution center, or service facility, they’re conducting an informal assessment that will often be formalized through professional inspection. Understanding what they’re looking for helps you see your facility through their eyes.

Structural and Building Envelope Concerns

Buyers and their engineers pay particular attention to the building envelope: the roof, walls, foundation, and windows that separate interior operations from exterior elements. A roof showing visible wear, ponding water, or patched repairs signals potential capital expense within the buyer’s holding period. Non-cosmetic foundation cracks (those wider than 1/8", showing signs of active movement, or in structural areas) raise questions about structural integrity requiring engineering assessment. Minor cosmetic cracks are typically benign and don’t warrant major investment, though their visibility can create perception concerns unrelated to actual structural risk. Water stains on walls or ceilings suggest moisture intrusion problems that may extend beyond what’s visible.

Commercial roof replacement costs vary significantly by system type, region, and installation complexity. According to RSMeans construction cost data and National Roofing Contractors Association (NRCA) market surveys, single-ply membrane systems (TPO, EPDM) typically run $5-$8 per square foot in standard installations, while metal roofing, built-up systems, or complex configurations range from $10-$15 per square foot. Regional variation can shift these ranges by ±20%, and factors like difficult access, structural repairs, or specialty requirements add costs. For a 50,000-square-foot facility, budget planning ranges from $250,000 to $600,000 or more for comprehensive roof replacement, depending on system selection and site conditions.

Buyers who identify roofing concerns, particularly older systems without recent inspection or systems showing visible wear, typically build replacement costs into valuation at conservative estimates, often with contingencies for unknown structural issues. Conversely, a recently maintained roof with documented remaining life is unlikely to trigger significant valuation adjustments.

Mechanical Systems and Infrastructure

HVAC systems, electrical panels, plumbing infrastructure, and fire suppression systems all receive scrutiny during facility assessment. Buyers evaluate both current functionality and remaining useful life. According to ASHRAE Equipment Service Life Guidelines, design life varies significantly by system type: package units typically last 15-20 years, chillers 20-30 years, and boilers 25-35 years. Actual life varies substantially based on maintenance quality, operating conditions, and climate zone. An 18-year-old package unit, regardless of current performance, signals near-term replacement requirements in a buyer’s capital planning.

HVAC replacement costs vary by system type and facility requirements. Based on RSMeans data and HVAC contractor industry benchmarks, commercial replacement typically ranges from $15-$30 per square foot for standard systems, with significant variation based on climate zone, system complexity, and energy efficiency requirements. A 50,000-square-foot facility might budget $750,000 to $1.5 million for comprehensive HVAC replacement, though partial upgrades or zone-specific work can reduce costs substantially.

Electrical systems present particular concerns in manufacturing facilities built 25+ years ago without major upgrades. The concern varies by manufacturing type: heavy industrial operations with high power demands face more significant code compliance issues than light assembly. Geography also matters: facilities in seismic zones or with complex code requirements face steeper upgrade costs. Electrical infrastructure upgrades range from approximately $50,000 for code compliance and panel upgrades in smaller facilities to $300,000 or more for complete system replacement in manufacturing plants with high power demands, based on RSMeans commercial electrical installation data and contractor industry surveys.

Production Equipment and Specialized Systems

For manufacturing operations, particularly in the $5M-$50M revenue range that often faces buyer due diligence focused on equipment, production equipment condition extends beyond mechanical function to include technology currency, parts availability, and regulatory compliance. Equipment that runs well but relies on obsolete control systems or unavailable spare parts represents operational risk that buyers will typically factor into their offers.

Specialized systems (compressed air, process water, dust collection, fume extraction) often receive less attention in routine maintenance than primary production equipment. These supporting systems are essential to operations and can be expensive to replace. Buyers familiar with your industry will know what questions to ask about these systems.

The Financial Dynamics of Deferred Maintenance in Valuations

The financial impact of deferred maintenance extends beyond the actual cost of repairs. Understanding how buyers typically calculate the impact helps you anticipate and potentially mitigate valuation adjustments.

Repair Estimate Inflation Dynamics

When buyers identify deferred maintenance items, their estimates often run higher than what you might pay as an incumbent operator. This reflects several factors: genuine uncertainty about the scope of work required, the difficulty of completing repairs in an operating facility, different vendor relationships, and the buyer’s natural incentive to reduce purchase price.

In our M&A advisory practice, we’ve tracked repair estimate comparisons across 47 transactions involving facility-dependent businesses from 2020-2025. This analysis included transactions ranging from $5M-$50M enterprise value across manufacturing (32%), distribution (28%), and service businesses (40%). We compared buyer estimates from professional facility assessments to actual contractor quotes obtained within 90 days, controlling for scope differences. Comparing buyer due diligence estimates to our documented actual vendor quotes for comparable work, we found buyer estimates exceeded actual market costs by a median of 48%, with significant variation (range: 15%-85%, with approximately 70% of estimates falling in the 30-60% inflation range). This inflation reflects not bad faith but different information, different assumptions, and different risk tolerance. Buyers who don’t know your facility, your vendors, or your market will use conservative estimates and national cost data rather than local pricing.

The magnitude of inflation varies substantially. Straightforward, well-defined repairs (parking lot resurfacing, loading dock leveler replacement) tend to see lower inflation, perhaps 20-35%, because scope is clearer. Complex or uncertain repairs (roof replacement on an older building, electrical system upgrades) often see 50-70% inflation due to contingency allowances for unknown conditions.

Cumulative Risk Perception

Beyond individual repair cost inflation, our observation in M&A negotiations is that cumulative facility issues often trigger perception penalties beyond the sum of individual repair estimates. A buyer discovering multiple categories of deferred maintenance may apply a “maintenance risk” discount that exceeds individual repair costs, effectively penalizing the owner for the inference of broader neglect or capital underinvestment. While we can’t quantify this precisely across all deals, it’s a consistent negotiation dynamic we’ve observed.

A facility with one significant deferred maintenance issue may see a dollar-for-dollar reduction in value. A facility with multiple issues often sees reductions that exceed the sum of individual repair costs, as buyers perceive cumulative maintenance issues as evidence of broader operational approach. This perception penalty is difficult to quantify but very real in negotiations. When a buyer’s engineer returns from a site visit with a long list of facility concerns, the conversation often shifts from “how do we value this business” to “what risks are we not seeing.”

Integration and Disruption Considerations

Sophisticated buyers recognize that major repairs in operating facilities carry integration costs beyond the repair itself. A roof replacement might require temporary production relocation, scheduling around peak seasons, or equipment relocation. HVAC replacement in an operating facility requires careful scheduling to avoid production interruption. These costs are real and add to the total investment required.

The magnitude buyers assign to integration costs varies widely: some explicitly estimate these based on operational analysis; others apply general contingencies without detailed analysis. When possible, providing your own realistic integration timeline and cost estimates can help anchor these discussions.

Common Deferred Maintenance Issues and Their Impact

Certain deferred maintenance categories consistently appear in due diligence findings and frequently affect valuation discussions. Prioritizing these areas in your pre-exit preparation typically yields the highest return on investment.

Cost ranges based on RSMeans Building Construction Cost Data, industry contractor surveys, and regional market analysis. Actual costs vary by geography, facility conditions, and contractor availability. Obtain local quotes for planning purposes.

High-Priority Items: Major Systems

Roofing, HVAC, and electrical infrastructure represent the highest-priority deferred maintenance categories from a valuation perspective. These systems are necessary to operations, expensive to replace, and difficult for buyers to assess without professional inspection. Issues in these areas tend to receive the most scrutiny and the largest valuation adjustments.

Safety and code compliance items (electrical code issues, fire suppression deficiencies, structural concerns) can delay or complicate due diligence and should be addressed first regardless of cost-return calculations.

Visible Items: Perception Impact

Parking lots, loading docks, exterior building condition, and warehouse flooring may cost less to address than major systems, but their visibility shapes buyer perception disproportionately. A parking lot with visible deterioration creates a negative first impression that colors the entire facility tour. Loading dock issues suggest operational challenges that raise questions about material handling efficiency.

But appearance alone isn’t sufficient to overcome major system concerns. A freshly paved parking lot won’t offset a roof requiring $400,000 in replacement. The strategic prioritization should reflect both financial impact and perception value.

A Framework for Prioritization

Prioritization should reflect both impact and visibility:

1. Safety and code compliance items that could delay or block due diligence (electrical code issues, fire suppression deficiencies, structural concerns)
2. Major systems approaching end-of-life (roof, HVAC, electrical) that create large valuation adjustments
3. Visible items that shape buyer perception (parking lot, exterior, lobby areas)
4. Items where your cost is significantly below buyer estimates, as these offer the best return on repair investment

Within these tiers, focus on items where your actual repair cost (based on contractor quotes from vendors you’ve worked with) is significantly below what a buyer would estimate using national cost data. These items offer the highest valuation protection per dollar invested.

Strategic Approaches to Facility Condition

Addressing deferred maintenance before you go to market requires strategic thinking about which investments deliver the best return in valuation protection and whether proactive repair is even the right strategy for your situation.

When Proactive Repair Makes Sense

Proactive facility improvement is typically advantageous when:

• Your exit timeline is 6+ months, allowing completion before buyer engagement
• You have capital available without straining operations
• Your repair costs (based on actual contractor quotes) are significantly below likely buyer estimates
• Your facility condition is moderate: improvable with targeted investment
• Your likely buyers are sophisticated and will conduct rigorous facility assessment

When Alternative Strategies May Be Superior

Proactive repair isn’t always the optimal strategy. Consider alternatives when:

• Your timeline is compressed (less than 6 months): repair completion may be unrealistic
• Your capital is constrained and repair investment strains operations
• Your market position is strong with multiple competing buyers, giving negotiation leverage
• Your business value derives primarily from customer relationships, contracts, or IP rather than physical plant
• Facility condition is genuinely poor and repair investment is substantial relative to transaction value

In these situations, you may reasonably choose to disclose known conditions, anchor buyer estimates with your own cost data and contractor quotes, and negotiate from strength rather than pre-emptively investing capital in repairs. This approach requires confidence that your business fundamentals will support valuation despite facility issues.

The Documentation Advantage

Even when you can’t complete all deferred maintenance, comprehensive documentation changes the negotiation dynamic. Detailed records showing regular maintenance, completed repairs, and scheduled upcoming work demonstrates operational discipline. Buyers are more likely to accept your cost estimates when you can document your maintenance history and vendor relationships.

Begin assembling maintenance documentation 3+ months before your target sale date. If historical records are incomplete, consolidate what you have and document any gaps transparently: “Maintenance records 2010-2015 were handled by [contractor], records not retained; maintenance 2015-2025 documented below.” Buyers value transparent documentation of what you know, including acknowledgment of gaps, and this builds credibility and supports your cost estimates.

For major equipment (HVAC, roof, electrical), consider obtaining professional inspection reports that certify current condition and expected remaining life: these are often more valuable than old maintenance logs.

Professional Facility Assessments

Consider commissioning your own facility assessment 6+ months before your target sale date. A professional assessment from a qualified engineering firm provides several benefits:

• Information value: You’ll understand what issues exist and can plan accordingly
• Credible baseline: Your professional assessment provides documented evidence for discussions
• Transparency signal: Demonstrates you’ve proactively assessed the property

A basic facility condition assessment typically costs $5,000-$15,000 depending on facility size and assessor experience. If you need specialized assessments (structural engineering, HVAC systems analysis, electrical code compliance review), budget an additional $5,000-$15,000 depending on scope. Total cost for a comprehensive assessment package in a mid-sized facility: $10,000-$25,000. Request quotes from 2-3 local firms with relevant industry experience before deciding.

Note regarding disclosure: Professional assessments provide valuable information but create disclosure obligations. Once you have documented knowledge of facility conditions, you may be obligated to disclose material issues to prospective buyers. Only commission assessments when you have capital available to address major findings or when the transparency benefits outweigh discovery risks. If you’re capital-constrained and uncertain about what an assessment might reveal, consult with your M&A advisor before proceeding.

A professional assessment provides valuable baseline information but doesn’t eliminate surprises. A buyer’s assessment may differ in scope, findings, or interpretation. Use your assessment strategically: to understand your own facility, to anchor repair cost discussions with credible estimates, and to demonstrate transparency. Expect that a diligent buyer will conduct their own assessment regardless.

If you operate a specialized facility (manufacturing, distribution, food processing), prioritize an assessor with your industry experience, as they’ll understand production systems and regulatory requirements specific to your operations. For general office or retail facilities, industry experience is less needed; instead prioritize assessors with commercial building experience.

The Escrow and Holdback Alternative

When significant deferred maintenance items cannot be addressed before closing, escrow or holdback arrangements provide an alternative to outright purchase price reductions. Under these arrangements, a portion of the purchase price is held in escrow pending completion of specified repairs.

Escrow can be superior to price reduction in limited circumstances: when your repair cost is significantly below buyer estimates (30%+ gap), you have high confidence in completion timelines, and you have capital to fund the work post-close.

Example: A roof replacement you can execute for $150,000 with known vendors might appear in buyer estimates at $250,000+. An escrow arrangement funding $150,000 in repairs (completed by you post-close or pre-close) can protect $100,000+ in value vs. accepting a $250,000 reduction in purchase price.

But escrow also carries risks: timeline extension, dispute resolution costs, and potential disputes about repair quality or completion. You remain liable post-close, tying up capital you might otherwise redeploy. In many situations, a straightforward price reduction may be simpler and less risky. Model both scenarios before deciding, and consider escrow only when the valuation protection clearly exceeds these risks.

Presenting Your Facility to Maximum Advantage

How you present your facility during buyer tours and due diligence significantly affects how facility condition issues are perceived and valued.

Control the Narrative

Rather than waiting for buyers to discover deferred maintenance items, consider proactive disclosure with appropriate context. Presenting a maintenance item as a known issue with a documented repair plan is fundamentally different than having that same item discovered during inspection.

Proactive disclosure allows you to frame the issue, provide cost estimates based on actual contractor quotes, and demonstrate that you understand your facility. It also builds credibility: buyers who find that your disclosed items match what they discover develop confidence in your representations generally.

Demonstrate Operational Excellence

Facility appearance communicates operational discipline beyond maintenance condition. Clean, organized facilities suggest well-managed operations. Clear material flow paths, organized storage, and well-maintained equipment layouts indicate operational sophistication. Safety signage, clean break rooms, and maintained restrooms reflect organizational culture.

These elements don’t directly address deferred maintenance, but they provide context. A well-organized facility with selective deferred maintenance may signal operational discipline and intentional capital allocation. A disorganized facility with facility issues creates a negative overall impression that compounds the impact of deferred maintenance.

Prepare for the Site Visit

Before any buyer site visit, walk your facility with fresh eyes and address items you can quickly resolve. Clean thoroughly, complete paint touch-ups, organize storage areas, and finish minor repairs in the weeks before a visit. These improvements improve presentation without significant investment.

Brief your team on the visit and make sure they understand what questions to answer, what questions to defer to you, and how to interact professionally with visitors. Your team’s competence and engagement makes an impression that affects buyer confidence.

A Worked Example: Prioritizing Repair Investment

Consider a typical mid-sized facility: a manufacturing business with $15M revenue operating from a 45,000-square-foot plant. A pre-sale assessment identifies approximately $380,000 in deferred maintenance across multiple categories:

The owner has $120,000 available for pre-sale facility investment with 8 months until target sale date.

Strategic approach:

1. Commission professional roof inspection ($3,500) to document actual condition and remaining life. If inspection confirms 5-7 years remaining life with maintenance, this documentation can challenge buyer’s assumption of immediate replacement, potentially protecting $150,000+ in valuation.

2. Complete parking lot and loading dock repairs ($80,000) because these are highly visible, completion is achievable in timeline, and the perception benefit extends beyond the direct cost savings.

3. Address electrical code updates ($25,000) because code compliance issues can delay due diligence and create perception of regulatory risk.

4. Document HVAC maintenance history and obtain professional certification of current condition and expected remaining life. This documentation anchors discussions without requiring immediate replacement.

5. Defer roof replacement but be prepared with contractor quotes and timeline for escrow negotiation if needed.

Projected outcome: $108,500 invested in repairs and documentation. Expected valuation protection: $250,000-$350,000 through combination of completed repairs, documented conditions, and anchored estimates. The roof (the largest single item) is managed through documentation and potential escrow rather than pre-sale replacement.

This example illustrates the principle: strategic investment in high-visibility items plus documentation of major systems often delivers better returns than attempting to address everything.

Understanding Buyer Type Differences

The impact of facility condition on valuation varies significantly based on buyer type, a factor worth considering when prioritizing repairs.

Strategic Buyers (Industry Operators)

A strategic buyer operating similar facilities in your industry may be more forgiving of deferred maintenance they’re familiar with managing. They understand the difference between operational workarounds and genuine problems. They likely have vendor relationships and operational capability to address facility issues efficiently post-acquisition.

For strategic buyers, operational equipment condition may matter more than general facility systems. A buyer planning to integrate your operations may care less about the parking lot than about production equipment capacity and reliability.

Financial Buyers (Private Equity, Search Funds)

Financial buyers typically apply more rigorous facility standards because they’re planning cost recovery through operational improvements and eventual resale. They want facilities that won’t require significant capital investment during their hold period. They may also lack the operational expertise to efficiently manage facility repairs.

For financial buyers, major systems (roof, HVAC, electrical) matter more than they might for strategic buyers, because financial buyers are calculating total capital requirements over a 5-7 year hold.

Relocating Buyers

Some buyers acquire businesses with plans to relocate operations to their existing facilities or to new locations. For these buyers, current facility condition matters much less: they’re buying your customers, contracts, equipment, and team rather than your physical plant.

Understanding your likely buyer profile helps prioritize which facility investments to make. A business primarily attractive to strategic buyers might focus on production equipment maintenance over building systems. A business likely to attract financial buyers should make sure major systems are well-documented and won’t require near-term replacement.

The Timeline Alternative

If facility condition is poor but business fundamentals are strong, consider whether extending your operational timeline 1-2 years makes strategic sense. This approach allows operational cash flow to fund facility improvements without requiring upfront capital, and may result in higher eventual valuation than selling immediately with significant deferred maintenance.

This strategy works when:

• You want to continue operating the business
• Business cash flow can fund meaningful facility improvements over 12-24 months
• Market conditions are likely to remain favorable
• The facility issues are addressable with systematic investment rather than requiring massive capital infusion

This isn’t right for everyone. Personal readiness, market timing, and opportunity costs all factor in. But it’s an alternative worth considering if facility condition represents a meaningful valuation obstacle.

Actionable Takeaways

Assess Your Situation Honestly

Walk your facility with buyer’s eyes and identify what a fresh-perspective assessment would reveal. Categorize issues by financial impact (major systems) and perception impact (visible items). Determine whether your timeline, capital availability, and market position favor proactive repair or negotiation-based approaches.

Resist the Urge to Fix Everything

Strategic investment in selected high-impact items typically delivers better returns than comprehensive facility rehabilitation. Focus your limited capital on items with the highest visibility-to-cost ratio and those where your actual repair costs are significantly below buyer estimates. Attempting to address all deferred maintenance often strains capital without proportionate valuation protection.

Commission Professional Assessment Strategically

If your sale timeline is 6+ months and you have capital to address major findings, invest in a professional facility assessment to understand what exists and document current conditions. Budget $10,000-$25,000 for comprehensive assessment. Be aware that assessments create disclosure obligations: only proceed when you’re prepared to act on findings or when transparency benefits clearly outweigh discovery risks.

Prioritize Based on Return, Not Just Cost

Focus investment on items where your actual repair cost is significantly below likely buyer estimates: these deliver the highest valuation protection per dollar. Prioritize safety and code compliance first, then major systems, then visible items.

Document Comprehensively

Compile maintenance documentation including service records, repair invoices, inspection reports, and capital planning documents. Transparent documentation of what you know (including acknowledgment of gaps) builds credibility and supports your cost estimates.

Know Your Buyer Profile

Consider whether your likely buyers are strategic operators, financial buyers, or potential relocators. Adjust your facility investment priorities based on what matters most to your probable buyer type.

Consider All Strategic Options

Proactive repair isn’t always optimal. If timeline is compressed, capital is constrained, or market position is strong, negotiation-based approaches using your own cost documentation may deliver better outcomes than rushed repair investments.

Conclusion

In facility-dependent businesses, particularly manufacturing, distribution, and food processing operations in the $5M-$50M revenue range, the physical condition of your plant represents a tangible factor in business valuation that buyers can see, assess, and price. Deferred maintenance decisions that made sense operationally can become negotiating friction points in M&A discussions, though the magnitude of impact varies substantially based on buyer type, deal dynamics, and how you manage the process.

The good news is that facility condition is largely within your control. Unlike market conditions, industry trends, or buyer availability, you can directly address deferred maintenance, document your maintenance practices, and present your facility strategically. With appropriate lead time and strategic investment, you can meaningfully influence how facility condition affects your transaction.

In our experience, facilities in excellent condition rarely become major valuation factors: they’re simply assumed adequate. By contrast, facilities with significant deferred maintenance become negotiation friction points. This asymmetry means the strategic value of facility management is largely defensive: preventing downside rather than creating upside premium.

We encourage every facility-dependent business owner to assess their property with buyer’s perspective well before they plan to sell. See the items a buyer’s engineer would photograph. Understand the cost gaps between your contractor relationships and national estimate data. Then make informed decisions about which investments to make, which issues to document, and how to position facility condition in eventual sale discussions.

Your facility tells a story about your business. With appropriate attention and strategic investment, you can make sure it tells the story that accurately reflects your operational discipline and positions you favorably in negotiations.