I've spoken with some searchers who flat-out avoid opportunities with real estate involved. This is silly. Sure, it might be a liability on the balance sheet, so what else can you do?

This is where you should at least examine if a sale-leaseback of the real estate is a viable option. Perhaps the property is being sold for its appraised value. From there, you go to a real estate broker and get an opinion of value. If the business has good financials and can support a healthy rent coverage, the new lease payments guaranteed by the business could create a nice spread between the appraised value and the value with a lease in place.

Businesses trade on multiples, real estate often trades on cap rates. The "cap rate multiple" is 1/cap rate. So, a 5% cap rate is a 20x multiple, a 6% cap rate is ~16x multiple. Essentially, you're removing rent from EBITDA but selling it at a higher multiple to increase the overall enterprise value. If the goal is to grow the business, the capital can be better used in business operations as opposed to having a mortgage on the balance sheet (and the property is not income-producing).

If there is a healthy enough spread, there can be a simultaneous closing of the real estate and business together with the extra real estate proceeds being used to help fund the business. Additionally, you can buy both the biz and RE, increase EBITDA, then execute a sale-leaseback later to maximize proceeds/value. Happy to discuss this further with anyone. My DMs are open as well.