Hi, first time poster long time lurker here...
I'm under contract for a 3 bay touchless car wash - purchase price of 1.65 million. The Revenue in 2023 was 600k (including sales tax). NOI ~ 375k in 2023
2024 t12 numbers not as good. Gross Revenue of 475k - NOI is around $260k
Equipment is new (last 3 years - all new touchless washes, new doors) - 3 Petit Acutrac 360-I installed in 2022. I total it was a bit over $1 million in cap ex including 3 new machines and all new doors.
I live quite a bit away from this - like 1.5 hours away. I do have a contact onsite that I can trust to show up in the case of an issue.
How much hands on would this require? Do I need a full time employee to be there? The terminals are currently cashless (this was cited by an outside company I'm talking to as one of the major reasons for revenue decline). I do have someone that can refill chemicals and do basic maintenance as well as a trustworthy company that does larger service items and supply chemicals (remote coded access as well as security cameras on site). I have a plan for the customer service issues - better than what the current ownership is doing.
Financing terms have been favorable for this - looking at around 80% LTV loan - possible to get 90% LTV depending on appraisal.
My background is in real estate investing. I do have a full time job and am able to work that while managing my own real estate portfolio. Would a touchless car wash be able to be run the same way - semi-passive? Not that there isn't work in real estate, for the most part I never have to be the person showing up there to get something done. I can usually just make a phone call and have someone else show up.
I'm not concerned with maximizing every dollar out of this business - but obviously I would need this to make more money that my typical real estate investment (this is priced at like a 16 cap, whereas I can look for months and not find a 9 cap in real estate). My wife would be able to help with some of the things that would be needed - I'd probably reinstall terminals that accept cash and have her go collect that as needed.
As with any investment / new business I'm clearly overlooking very large aspects - things that you can't learn until you're in the business. Could someone help provide me with some insight into what I'm missing? What aspects of managing this business I'm not considering? How hands-on does an owner need to be on this business?
Any guidance would be appreciated
The land itself is probably only 200k or so in value despite being on a busy road - it's in a small town.
I'm under contract for a 3 bay touchless car wash - purchase price of 1.65 million. The Revenue in 2023 was 600k (including sales tax). NOI ~ 375k in 2023
2024 t12 numbers not as good. Gross Revenue of 475k - NOI is around $260k
Equipment is new (last 3 years - all new touchless washes, new doors) - 3 Petit Acutrac 360-I installed in 2022. I total it was a bit over $1 million in cap ex including 3 new machines and all new doors.
I live quite a bit away from this - like 1.5 hours away. I do have a contact onsite that I can trust to show up in the case of an issue.
How much hands on would this require? Do I need a full time employee to be there? The terminals are currently cashless (this was cited by an outside company I'm talking to as one of the major reasons for revenue decline). I do have someone that can refill chemicals and do basic maintenance as well as a trustworthy company that does larger service items and supply chemicals (remote coded access as well as security cameras on site). I have a plan for the customer service issues - better than what the current ownership is doing.
Financing terms have been favorable for this - looking at around 80% LTV loan - possible to get 90% LTV depending on appraisal.
My background is in real estate investing. I do have a full time job and am able to work that while managing my own real estate portfolio. Would a touchless car wash be able to be run the same way - semi-passive? Not that there isn't work in real estate, for the most part I never have to be the person showing up there to get something done. I can usually just make a phone call and have someone else show up.
I'm not concerned with maximizing every dollar out of this business - but obviously I would need this to make more money that my typical real estate investment (this is priced at like a 16 cap, whereas I can look for months and not find a 9 cap in real estate). My wife would be able to help with some of the things that would be needed - I'd probably reinstall terminals that accept cash and have her go collect that as needed.
As with any investment / new business I'm clearly overlooking very large aspects - things that you can't learn until you're in the business. Could someone help provide me with some insight into what I'm missing? What aspects of managing this business I'm not considering? How hands-on does an owner need to be on this business?
Any guidance would be appreciated
The land itself is probably only 200k or so in value despite being on a busy road - it's in a small town.
