Looking at buying a chain of 3, IBA, single stall car washes located in small towns surrounding a growing metro area.
Two of the locations have fairly new LaserWash 360+, but one of the locations has a much older machine, still waiting to hear back on the make/model of that machine.
The seller is asking $660k for all three, the washes had 2024 revenue of $165k and NOI of $80k, both revenue and NOI have been relatively consistent over the past 3 years. The seller is claiming Q1 2025 numbers are significantly up from previous years..... but I am skeptical.
I definitely think the seller is high, we are looking more into the low-mid $500k range, based on 3x of revenue and 6.5x NOI valuation methods. My biggest concern is the older equipment in one of the locations. Roughly what would this cost to replace? It is in a low income small town, with lower usage, so I would be thinking to replace it with a low end model from a name brand manufacturer.
What is everyone's initial thoughts on this deal? What should we be looking for, asking about, etc? Thank you.
Two of the locations have fairly new LaserWash 360+, but one of the locations has a much older machine, still waiting to hear back on the make/model of that machine.
The seller is asking $660k for all three, the washes had 2024 revenue of $165k and NOI of $80k, both revenue and NOI have been relatively consistent over the past 3 years. The seller is claiming Q1 2025 numbers are significantly up from previous years..... but I am skeptical.
I definitely think the seller is high, we are looking more into the low-mid $500k range, based on 3x of revenue and 6.5x NOI valuation methods. My biggest concern is the older equipment in one of the locations. Roughly what would this cost to replace? It is in a low income small town, with lower usage, so I would be thinking to replace it with a low end model from a name brand manufacturer.
What is everyone's initial thoughts on this deal? What should we be looking for, asking about, etc? Thank you.
