Buying a bank repo touchless with IQ system

[IanBen]

Hey everyone,

there is a touchless single bay wash for sale near my house, it was a good wash when it opened about 8 years ago but the previous owner didn’t maintain it and it went downhill until the bank took it back.

thinking about putting an offer in but have a few questions.
#1 the inside seems discolored like some algae build up. What is the process to scrub it down to original, what chemicals?
#2 some spray heads were plugged before it shut down, thought?
#3 how is this IQ system, any good? Any common issues that will shut me down?
#4 they have the entrance on the back and the pay terminal got broken into a few times, I’d really like to turn around the configuration to enter from the opposite and turn it all around, thoughts? Possible with some effort?

any other advice greatly appreciated!

 

[Roz]

Hey everyone,

there is a touchless single bay wash for sale near my house, it was a good wash when it opened about 8 years ago but the previous owner didn’t maintain it and it went downhill until the bank took it back.

thinking about putting an offer in but have a few questions.
#1 the inside seems discolored like some algae build up. What is the process to scrub it down to original, what chemicals?
Bay Wall Cleaner. We hire a local power washer to clean our walls as they use 2000psi from their truck.

#2 some spray heads were plugged before it shut down, thought?
Replace them. Call D&S as they can help you with their machine and advise you as to parts you might want to proactively replace.

#3 how is this IQ system, any good? Any common issues that will shut me down?

#4 they have the entrance on the back and the pay terminal got broken into a few times, I’d really like to turn around the configuration to enter from the opposite and turn it all around, thoughts? Possible with some effort?

Probably more work than you expect as you will need to run new lines and to rotate the equipment you will need the installer with a fork lift. Buy more hi res cameras and keep the way it is unless there are other reasons to make the change.

any other advice greatly appreciated!

 

[Waxman]

What is your experience in the car wash business? I would suggest you do some serious due diligence to determine the true reason the wash failed. Based on your questions, you need alot more knowledge about the car wash business. Maybe you can contact the previous owner, offer to buy them lunch and ask some well-thought out questions. I doubt the wash failed due to poor maintenance alone.

Cleaning algae and blocked nozzles are some of the most minor things you will encounter in the car wash business.

Moving the pay station??? Most cities / towns require a special permit process which includes engineering drawings describing lot layout, building dimensions, curb cuts, egress and utilities connections. Even if the city allowed you to completely change the traffic flow on the lot, moving the pay station and removing all bay equipment / signs / blowers and reinstalling it 'reversed' is not likely feasible from a cost standpoint.

The real reason the bank took the car wash back is probably that a single-bay auto wash is not the right business model for this particular location and it couldn't make enough money to make the loan payments..

 

[IanBen]

What is your experience in the car wash business? I would suggest you do some serious due diligence to determine the true reason the wash failed. Based on your questions, you need alot more knowledge about the car wash business. Maybe you can contact the previous owner, offer to buy them lunch and ask some well-thought out questions. I doubt the wash failed due to poor maintenance alone.

Cleaning algae and blocked nozzles are some of the most minor things you will encounter in the car wash business.

Moving the pay station??? Most cities / towns require a special permit process which includes engineering drawings describing lot layout, building dimensions, curb cuts, egress and utilities connections. Even if the city allowed you to completely change the traffic flow on the lot, moving the pay station and removing all bay equipment / signs / blowers and reinstalling it 'reversed' is not likely feasible from a cost standpoint.

The real reason the bank took the car wash back is probably that a single-bay auto wash is not the right business model for this particular location and it couldn't make enough money to make the loan payments..

Good Morning!
I am a car wash nut, but never owned one. Professionally I manage business advisors so I have extensive business experience plus me and my wife both have our MBA’s.

I know this location because I know the fellow that lost it. He was playing real estate operator and owned a number of sub par rentals and motels that were sitting empty. He was also going through a divorce and gave it all up so his wife can’t claim the assets but I think they were all poor assets anyway.

I pulled the lane title and see he paid 1.0mm a few years ago and now the bank has it listed for 600k. I feel like if you got it for 1/2 the price he paid your fixed costs would be so much lower it would be way easier to make a profit. I’d be fine with even a minimal profit knowing the building is also building equity.

 

[Roz]

check the assessed value to see if ask is close. Assessors know the land value better than most individuals. Banks want to move things off their books so you might be able to offer $400k depending on the assessed value. You probably will end up spending $100k to $200k more to get the place operating and to attract customers back to the place. If you wash 10k cars at $15 Ave price you are at 5x revenue all in which is fine for a solid location. Good luck!

 

[Waxman]

And now you want to play real estate operator? Who is going to run the place? What is the daily traffic count? What kind of neighborhood is it in? What's the competition like? You say the rest of his assets are worthless what makes you think this one is any better?

 

[IanBen]

And now you want to play real estate operator? Who is going to run the place? What is the daily traffic count? What kind of neighborhood is it in? What's the competition like? You say the rest of his assets are worthless what makes you think this one is any better?

Hey, location is right by my house so me and the wife will operate it plus maybe hire some part time person if we need some help.
it’s only a 5 year old building next to some other commercial buildings - hardware store, bottle depot, power company, and many apartments buildings.
Visibility is ok, thinking some money spent on advertising / signage couldn’t hurt.

 

[Waxman]

I think you need to do some more research into the car wash business and create a realistic business plan and go from there. Location is everything and traffic count is very important as is competition. There are plenty of operators on here who will tell you the problems associated with a single bay automatic car wash. You are assuming that the owners neglect is the cause that it failed but that might not be exactly true. Maybe he neglected it and let it fall into disrepair because it was a poor performing car wash. It's easy to lose enthusiasm in a project when it doesn't do as well as you had hoped or the machinery is not reliable.

 

[johnnygt]

Hey everyone,

there is a touchless single bay wash for sale near my house, it was a good wash when it opened about 8 years ago but the previous owner didn’t maintain it and it went downhill until the bank took it back.

thinking about putting an offer in but have a few questions.
#1 the inside seems discolored like some algae build up. What is the process to scrub it down to original, what chemicals?
#2 some spray heads were plugged before it shut down, thought?
#3 how is this IQ system, any good? Any common issues that will shut me down?
#4 they have the entrance on the back and the pay terminal got broken into a few times, I’d really like to turn around the configuration to enter from the opposite and turn it all around, thoughts? Possible with some effort?

any other advice greatly appreciated!

Did you ever pull the plug on this purchase? Would love to know the outcome.