![Page 1: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/1.jpg)
A Look Through the Windshield at Auto Dealership Valuation
Bradley R. Carter, MAI, CRE, CCIM, CDEI
![Page 2: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/2.jpg)
![Page 3: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/3.jpg)
Typical Auto Dealership Transaction
Total Price: $10,000,000Personal Property: $200,000Intangibles: $1,800,000Real Estate “Price”: $8,000,000
![Page 4: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/4.jpg)
Re-Imaging
• Required by the OEM• Standardization, Modernization, Expansion
o Best Investment = Expansion*o Best Investment = Standardization
Real Estate’s Worst Investment?
![Page 5: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/5.jpg)
Photo courtesy of Alden Jewell, from his collection at www.flickr.com/autohistorian
![Page 7: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/7.jpg)
Re-Imaging Case Study
Land Value: $2,100,000Cost: $7,950,000Depreciation (30%): ($2,385,000)Value: $7,665,000 (Prior to considering re-imaging)Cost of Re-imaging: $6,500,000Value: ???
– Prior to considering re-imaging
![Page 8: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/8.jpg)
“Never try to teach a pig to sing. It wastes your time and it annoys
the pig.”
George Bernard Shaw
![Page 9: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/9.jpg)
Photo courtesy of Alden Jewell, from his collection at www.flickr.com/autohistorian
![Page 10: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/10.jpg)
![Page 11: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/11.jpg)
![Page 12: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/12.jpg)
Which is Worth More?A) A place where people go to pick out a car?
Or
B) A place where people go to pick up a car?
![Page 13: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/13.jpg)
Source: Kerrigan Advisors, citing NADA
![Page 14: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/14.jpg)
“The idea that maybe you don’t have to own a car if you only need one occasionally may catch on, just like time-sharing caught on in real estate.”
Steve Case, AOL
![Page 15: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/15.jpg)
![Page 16: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/16.jpg)
“Prediction is very difficult, especially about the future.”
Niles Bohr, Danish physicist
![Page 17: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/17.jpg)
![Page 18: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/18.jpg)
![Page 19: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/19.jpg)
![Page 20: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/20.jpg)
![Page 21: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/21.jpg)
![Page 22: A Look Through the Windshield at Auto Dealership Valuation · “Never try to teach a pig to sing. It wastes your time and it annoys the pig.” ... Source: Kerrigan Advisors, citing](https://reader036.vdocuments.site/reader036/viewer/2022071016/5fcfc7bb7e483559611edc28/html5/thumbnails/22.jpg)