How to sell 5% ownership stake in apartment building?

[Brent Seehusen]

Here's the situation:  There's a 32-unit apartment building originally purchased in the 1970's by three business partners.  As the years have gone on, those original owners have passed away and the building has passed down to their children.  Now some of those 2nd generation children are at an advanced age and passing away so ownership is passing to the third generation grandchildren, resulting in smaller and smaller ownership stakes for each succeeding generation as it gets split between more people.

One of the 2nd generation owners with a 5% ownership stake recently passed away, leaving 1.67% ownership to each of his three children (the 3rd generation).  It's getting to the point that these fractional ownership interests are too small and the beneficiaries would rather just cash out than hold for the long haul.  What are the options for liquidating these small ownership shares, assuming none of the other owners in the building want to buy them out?

[Greg Scott]

There is no liquid market for issues like this so it will sell for whatever someone is willing to pay.  A new investor should be able to pick up the shares at a nice discount relative to what the underlying value should be.  (I've bought shares like this.)

On the other hand, this investment is not maximizing returns of any of its owners.  You have no more depreciation left to offset cashflow.  You could make your money work much harder for you.  The best course of action is probably selling the entire building and letting everyone get paid out that way.