Great idea, or horrible idea?

[soonermajic]

I found an IBA that has been closed down for a bout 8 years! The traffic count on that corner lot is 41,000! It is a city of 80,000 people and there is not a touchless wash at all! It is in a growing area, as well.
Has anybody heard of someone leasing the IBA and hitting it big? Very nice area of a suburb. VERY NICE

 

[Bricks]

I found an IBA that has been closed down for a bout 8 years! The traffic count on that corner lot is 41,000! It is a city of 80,000 people and there is not a touchless wash at all! It is in a growing area, as well.
Has anybody heard of someone leasing the IBA and hitting it big? Very nice area of a suburb. VERY NICE

It seems like most shy away from “not owning the dirt” , but if the price is right, I would.

 

[Waxman]

the best way to approach this is to do it like a professional businessman; create a business plan with 3 years of pro formas, marketing plan etc. do some homework. figure out why it was closed so long and what kind of business it was when it was open.

at the risk of sounding harsh, aren't you suffering with lackluster results on a current wash you own due at least in part to a lack of planning on your part?

 

[soonermajic]

Correct, I do have a lackluster wash. However, bad planning had zero to do with it. As a HIGHLY successful HS bb coach & AD, & being OCD, i usually overplan everything! Every battle is won before it is fought.
6500traffic count, but 15 mph directly in front of WalMart, & @ a corner with stop sign. Bought land & bldg for half of what it was worth. Even @ 18cpd, I make avg of $1400/ mo profit!
There isn't a carwash guy in America, who thought it was anything other than a great idea.

Now, back to the original question...

 

[soonermajic]

My thinking is usually C-store owners are not carwash guys. They run it themselves, & run it poorly. Then, when business suffers, they just shut it down.

Anyor ever tried this, or know someone whom has tried this?

 

[Flex- Wand]

Soonermajic: good find but do you have the time ?

 

[soonermajic]

Soonermajic: good find but do you have the time ?

Sooner is about to retire, in 18 mos.
He gonna need something to keep busy + teachers only get 62% of highest 5yr avg, upon retirement.

 

[Flex- Wand]

 

[washnshine]

Coach - how do you find all of these washes. I could drive over a 100 mile radius from me in any direction and there wouldn’t be a single deal like you always find - good for you! I hope if it’s right for you it works out.

 

[kentadel]

Generally I have always thought one should avoid leases and partnerships in business ventures. Agree with Bricks on if the price is great it may be worth it. Good luck!

 

[OurTown]

Coach - how do you find all of these washes. I could drive over a 100 mile radius from me in any direction and there wouldn’t be a single deal like you always find - good for you! I hope if it’s right for you it works out.

I agree. Rarely do I ever see anything that even slightly raises an eyebrow near here. He must have a great car wash deal sniffer.

 

[Waxman]

i'm noticing that no one has answered your question still, which was ; does anyone know Someone who leased a location and had tremendous success in that endeavor.

I wouldn't do it myself just because a big part of my strategy in business is investing in real estate. You're relying solely on volume and the success of reopening a long closed down car wash. seems very risky to me.

I'm curious to see if anyone knows about a true success story coming from circumstances like these.

 

[ShinePro]

So I know of several lease arrangements in my area.
1) has a sweet lease deal , long term , equipment is his.
He is making $$

2) Carriage House out of Cincinnati is leasing all the old UDF sites- refurbing with new equipment. Seems to be working well for them.

3) All the Take 5’s around here are selling the land and building with a lease back agreement.

4) I am considering selling one of my washes to the neighbor land owner- and( its a complicated story) - leasing the car wash back from him.
Take my money and invest elsewhere.

So I say its very do able. Just gotta get the right agreement!

 

[washnshine]

We often see on this forum: “I’m selling the wash for its land value” or “the wash is only worth the dirt it is on”. I think that speaks volumes to what that could mean down the road when it’s time to get out of the deal. It’s really requires careful consideration because if the business dries up, you don’t have that parcel to cash out with.

 

[Keno]

Is this part of a gas station? That would add a wrench in the works too. While I’m also mainly in car washes for real estate, a lease would make sense if you can make the numbers pencil it. Lots of business are built and successful in leased space. Car washes just take a specialty building, so the potential business in that space is just 1 unless major renovations $$$ are done. Setup an ironclad lease with first right of refusal with an attorney if you decide to pursue. If it’s attached with someone else’s gas station, I would personally shy away from that. Seems like a great location on paper though!

 

[Keno]

We often see on this forum: “I’m selling the wash for its land value” or “the wash is only worth the dirt it is on”. I think that speaks volumes to what that could mean down the road when it’s time to get out of the deal. It’s really requires careful consideration because if the business dries up, you don’t have that parcel to cash out with.

How many of these are due to neglect, pocketing cash and bad record keeping, or land values exceeding wash value? Probably a lot of them if I have to guess

 

[soonermajic]

Coach - how do you find all of these washes. I could drive over a 100 mile radius from me in any direction and there wouldn’t be a single deal like you always find - good for you! I hope if it’s right for you it works out.

Well, Im very OCD, & always on the lookout. This wash is actually 200 miles away, where my son is a fireman.
My thinking is: some of these closed down single bay iBAs are in tremendous locations.
Next, they all failed. Or did they? Maybe they were just doing below avg, but maintenance was a hasle. Those older machines seemed to have much more maintenance.
Finally, you don't have to buy land & build the building + it's location is exactly where you want.

 

[soonermajic]

I think im willing to be the Guinea pig, with some help. I will find out how much the lease will be. Didvide it up, between 20 of us, & we all put in about $$1500, so as not to break anyone.
If it does good, I will pay back $1000 of that exploratory fee. We can all start leasing these Hot spots, & stick it to the PE / tunnel guys. If it does bad, well... we all lose $1500.
No biggie..

 

[Roz]

Instead of a lease you can do a profit share arrangement. My rep/installer does those arrangements.

 

[soonermajic]

So, if I decided to lease this spot, whom would you guys say I talk to about that?

It appears a Big city area Fuel Co owns it, & leases it out to some foreigners.