Woodbury, NY (PRWEB) January 27, 2015
According to Glazer, those valuing real estate holding companies should take into account all relevant factors. In the scenario of valuing a privately owned real estate holding company, the analysis should begin by taking into account the net asset value, or NAV, of the entity when using the market approach.
“Of course, this does not mean that an income approach should not be performed as well,” he explains. According to Glazer, an income approach is also an important step when evaluating a real estate holding company. Analyzing the company using both approaches is the best way to conduct a thorough analysis. The different value indications are then integrated into a single value conclusion.
Some of the sources of information used to estimate the value of a real estate company may include real estate investment trusts (REITs), closed-end real estate funds (CEFs), and real estate limited partnerships (RELPs). Glazer emphasizes, however that when applying either the income approach or the market approach, it is important to use data that is most relevant or comparable to the real estate holding company in question.
One of the last steps of the valuation process is to consider the applicability of one or more valuation discounts or premiums. These, too, must be based on relevant empirical data and applied after careful consideration of all the facts.
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