Prices of desirable new-car dealerships are at a two-year high, driven by dealers' robust profits.
Nissan, Infiniti and Cadillac, which have well-regarded new products, have the fastest rising valuations. They are reaching levels enjoyed by Honda, Toyota and the top luxury lines.
Cadillac values have grown by 100 percent or more, says Joe Aboyoun, a lawyer in Fairfield, N.J., who specializes in dealership sales and purchases.
"If you're going to talk about one franchise on the domestic side that has really made a move, it's Cadillac," Aboyoun says. "It went from almost oblivion to being a real franchise of demand."
Valuations probably won't return to the crazy levels created in the late 1990s when public dealership groups went on a buying frenzy, say experts in dealership sales. But economic recovery and available cash have put more buyers in the market, generally pushing blue sky past the levels seen two years ago.
Blue sky is the value of a dealership beyond its tangible assets. Blue sky generally includes store location, franchise reputation, customer base and reputation. It is expressed as a multiple of a store's pretax earnings.