Selling a business
Considering All of Your Business Real Estate Options
The three ways to handle the property your business uses when you sell: include it, lease it to the buyer, or sell it separately, and how to choose.
By Michael D. Rubin, CEO & Founder · Updated September 2026 · 696 words
If your company uses property that you or the business own, you have three main options when you sell: sell the real estate with the business, keep it and lease it to the buyer, or sell it separately to an investor. The right choice depends on who owns the property, what buyers prefer, your tax position and whether you want rental income after the sale.
Many owners never think about this until an offer arrives, and then the choice is rushed. Deciding early lets you put the right lease in place, get the right appraisal and structure the deal cleanly.
The three options side by side
Each path has a different mix of cash, income and ongoing involvement. In summary:
| Option | Why owners choose it | What to watch |
|---|---|---|
| Sell the real estate with the business | One transaction and a complete exit, with no landlord role afterward | Fewer buyers can finance both; the property must be valued separately from the business |
| Keep it and lease it to the buyer | Ongoing rental income, and the business appeals to a wider pool of buyers | You stay tied to the company's success as its landlord; the lease must be solid |
| Sell it separately to an investor | Cash for both without becoming a landlord | Two deals to coordinate; the buyer of the business still needs a lease |
Who owns the property changes the work
When you own the building personally or through a separate entity, such as a real estate LLC, the path is clean. The operating company is valued on its earnings through a business valuation, the property is valued as real estate, and each can be sold or leased on its own terms.
When the operating company itself owns the property, it gets more complicated. The real estate has to be separated from the value of the business, usually with an independent appraisal, and moving it out of the company can carry tax consequences, particularly for a C corporation. That is a question for your CPA before you go to market, not after an offer lands.
What buyers tend to prefer
Buyers differ, so ask each serious one early. Some want to own the property, especially when the location would be hard to replace or when they are using financing that can cover real estate as well as the business. Many prefer to lease: private equity groups and strategic acquirers often want their capital working in the operating company, not tied up in buildings. An individual buyer may simply be unable to finance both.
Keeping your options open avoids losing a strong offer over a property question. For more on the pricing side, see whether real estate should be included in or separated from the sale price.
If you keep the property, write a lease a buyer will accept
A lease between an owner and his or her own company is often informal, or nonexistent. A buyer and its lender will not accept that. Before going to market, put a written lease in place that a new owner can rely on. A strong lease helps you later too: if you sell the building, an investor will pay more for a property with a reliable tenant under a well-drafted lease. Cover at least:
- Rent at a fair market rate. Rent set well above market lowers the company's earnings and its price; rent well below market overstates them, and a buyer will correct for it.
- A term long enough to satisfy the buyer's lender, with renewal options.
- Clear responsibility for repairs, maintenance, insurance and property taxes.
- Terms that allow the lease to be assigned to a new owner of the business.
How MDR & Associates handles real estate in a sale
In a sale, MDR & Associates presents the operating company on its adjusted earnings and treats the property as a separate decision, so each buyer can see both clearly and choose the structure that works for it. The firm works alongside your CPA and attorney on structure and can help arrange SBA, conventional or seller-financed structures when a buyer wants the property as well; see business financing. For a range on the business itself, start with a free valuation snapshot.
Where this fitsSell your business in Texas →
Questions owners ask next
Will keeping my building lower the price of my business?
Not if the lease is at market rent. The business is valued on its earnings, and a fair rent is a normal cost of operating. Problems arise when rent is set too high, which lowers earnings and price, or too low, which a buyer will simply correct in its own numbers.
Can a buyer use an SBA loan to buy the building too?
SBA-backed loans can often finance real estate along with a business acquisition, subject to the lender's requirements. Whether it makes sense depends on the buyer's cash, the property's value and the lender's view. Your advisor and the buyer's lender will work through it once a buyer has been chosen.