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Selling my wash

Rfreeman

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If the property (land) is a lot more then any commercial realtor worth anything could easily pull comps for you. I would note on the listing value in the land.
 

Martins

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The biggest thing i have found as looking for another location is yes 2-3x gross is where you want to be however that includes the property. as my bank stated to me " we dont want to own car washes and most people over pay for them because of the "land value" and we end up owning them shortly after because they can't afford the payments"

When looking at the sales numbers if a wash is making 30k and we say its worth 60-120k based on the income, however the property is worth 250,000 with a 5.2% cap and thats what its selling for, your already in the negative on overall NOI. which means the "specialty use property" and your income producing property would be losing money right off the bat making it a bad investment and the banks will not touch it at all.

I've looked at alot of washes lately and everyone is trying to get inflated top dollar prices because of the market which is fine but if its not making enough to make the mortage payment and still have some left the bank wont even look at it.

the whole point of my post however is not to crap on anyones listing, but more or less to make sure im in the right mind set on buying more washes. but also posting listings with cap rates will make it much easier for potential buyers and wont waste anyones time.

thoughts? also i sent your listing to a buddy who lives in fl looking for a new wash! looks good!
 

Roz

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The biggest thing i have found as looking for another location is yes 2-3x gross is where you want to be however that includes the property. as my bank stated to me " we dont want to own car washes and most people over pay for them because of the "land value" and we end up owning them shortly after because they can't afford the payments"

When looking at the sales numbers if a wash is making 30k and we say its worth 60-120k based on the income, however the property is worth 250,000 with a 5.2% cap and thats what its selling for, your already in the negative on overall NOI. which means the "specialty use property" and your income producing property would be losing money right off the bat making it a bad investment and the banks will not touch it at all.

I've looked at alot of washes lately and everyone is trying to get inflated top dollar prices because of the market which is fine but if its not making enough to make the mortage payment and still have some left the bank wont even look at it.

the whole point of my post however is not to crap on anyones listing, but more or less to make sure im in the right mind set on buying more washes. but also posting listings with cap rates will make it much easier for potential buyers and wont waste anyones time.

thoughts? also i sent your listing to a buddy who lives in fl looking for a new wash! looks good!
A). Banks do not want to lend money for a carwash purchase unless the buyer has enough assets to guarantee the loan repayment.
B) Sometimes paying land value over business value for a good location that is underperforming due to the current owner makes sense.
C). Some carwashes are selling in the 5x-10x range if they have significant revenue and number of cars washed for one location as interest rates are still uber low and the depreciation is an added value if you have offsetting revenue.
 

Kramerwv

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The biggest thing i have found as looking for another location is yes 2-3x gross is where you want to be however that includes the property. as my bank stated to me " we dont want to own car washes and most people over pay for them because of the "land value" and we end up owning them shortly after because they can't afford the payments"

When looking at the sales numbers if a wash is making 30k and we say its worth 60-120k based on the income, however the property is worth 250,000 with a 5.2% cap and thats what its selling for, your already in the negative on overall NOI. which means the "specialty use property" and your income producing property would be losing money right off the bat making it a bad investment and the banks will not touch it at all.

I've looked at alot of washes lately and everyone is trying to get inflated top dollar prices because of the market which is fine but if its not making enough to make the mortage payment and still have some left the bank wont even look at it.

the whole point of my post however is not to crap on anyones listing, but more or less to make sure im in the right mind set on buying more washes. but also posting listings with cap rates will make it much easier for potential buyers and wont waste anyones time.

thoughts? also i sent your listing to a buddy who lives in fl looking for a new wash! looks good!
Banks care about cash flow first and collateral second (if not third or fourth). As you state, if the business cannot repay the debt associated with the purchase then the Bank will pass. The guys that are paying 10x are private equity players chasing cash on cash yield with no borrowing. A different animal for sure and damn hard to compete against.
 
Etowah
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