Success Stories

Retail Site Selection:

Morton Williams –
Lease vs. Purchase

Abstract:

Admiral was engaged by Morton Williams, a major regional grocery chain, to help them determine whether to purchase or lease a retail condominium on the Upper West Side of Manhattan. Admiral’s analysis ultimately revealed that neither option was ideal, and that the location was not appropriate for their business.

CHALLENGES:

  • The grocer did not have the tools to compare the potential deals themselves, and needed to find a firm to provide them with data and analysis to help the partners assess their options.

Solution:

  • In the end, thanks to Admiral's analysis, the partners determined that this location was not ideal and decided neither to rent nor buy, and pursued a different nearby location.
  • Additionally, as part of their analysis, Admiral highlighted other considerations which could affect the partners' decision to rent versus buy, including the ability to control the property, alternative investments available, and the benefits of diversification.
  • Admiral’s analysis showed that, after taking the time value of money into account, both options were relatively costly. However, the after-tax cost of renting was lower due to the significant initial investment required to purchase, combined with the relatively high purchase price dictated by the heated sales market.

Client BENEFITS:

  • In the end, thanks to Admiral's analysis, the partners determined that this location was not ideal and decided neither to rent nor buy, and pursued a different nearby location.
  • Additionally, as part of their analysis, Admiral highlighted other considerations which could affect the partners' decision to rent versus buy, including the ability to control the property, alternative investments available, and the benefits of diversification.
  • Admiral’s analysis showed that, after taking the time value of money into account, both options were relatively costly. However, the after-tax cost of renting was lower due to the significant initial investment required to purchase, combined with the relatively high purchase price dictated by the heated sales market.