Borrowers are constantly asking me what their signs are worth. My rule of thumb is that billboards are worth 4-6 times annualized gross revenues. The transactions which I have financed over the last 10 years have occurred at multiples ranging from 3 to 6 times gross revenue with a median of 4.8 times gross revenue.
Your your billboards will sell on the high end of the range if:
- They are at least 14 by 48.
- The economy is strong.
- They have 20 year leases with lease costs less than 20% of revenues.
- They are in good condition.
Your billboards will sell on the low end of the range if:
- They are 8 sheet or 12 by 24.
- The economy is in recession.
- You have short term leases with lease costs in excess of 20% of revenue.
- They are in poor condition.
- They are unoccupied.
