In real estate and business valuation, Goodwill is an intangible but transferable asset that reflects the value of a business beyond its physical assets. It is based on the expectation of continued customer loyalty, reputation, brand recognition, and established relationships that generate ongoing patronage.
Goodwill is often considered when valuing income producing properties that include an operating business, such as hotels, restaurants, or retail establishments. Although it cannot be physically measured, goodwill can significantly affect a business’s overall value and sale price.
