My partner and I have one location with back to back digital billboards. They are smaller, at 7’hX12’ w, are almost two years old, 16mm pitch, are located along a business route with a daily traffic count of about 20,000 vehicles. We have had a difficult time attracting advertisers and are looking to sell the signs with the ground lease. I remember seeing a formula based on income from the signs that determined their value. I haven’t been able to find that post, can anyone help me? Thanks. Ron
Billboards normally sell for a range of 10% to 20% cap rate. So you need to figure out the current net income of the sign, and then apply a return level of 10% to 20%. If the sign has no income currently, your only hope is to find a buyer at replacement cost, or maybe to find someone who thinks they can do a better job of renting the ad space. You should do a direct mail piece to all the billboard companies in your area to see if any are interested, and then maybe put up on the sign “This sign for sale”.