Where do I begin? Commercial investing -- ie: Car Wash

[Aaron McCurdy]

Hello, All!  

First off, thanks for any advice that I can get.  I am learning as much as I can but there is so much to all of this. 

My wife and I have been discussing what we can do to leverage some of our money and diversify.  We both currently work in semiconductor/technology.  She is a senior level manager and I am an engineer, to sum it up, I make about 1/4 of our income which last year was over mid 6 figures... we do fairly well together but have discussed the possibility of diversifying as we are heavily invested in our current company.  

We have 1 rental which was my house prior to us moving in together and getting married.  It is self sufficient for now and has appreciated quite nicely.  Our current residence is paid off and we have no debt. 

What I am looking at right now, just as an example, is the purchase of 2 car washes here in town.  I have contacted the sellers agent and they are willing to share financials with me when I sign a CA. 

My Questions:

Where should we start?  I have been scouring BP for any and all info I can find, but there are some things that are more difficult to find. 

1.  How does financing work with something like this... the deal would be ~2.5M for both car washes.  What are we looking at loan wise for this? 

2. Should we start an LLC? and if so, I am assuming we would provide the "startup" money for this LLC then the LLC would purchase the properties.

3.  In the end, ideally, I would be quitting my day job to run this company.  My wife, the breadwinner, would be funding it.  What sort of Tax benefits are we looking at as we are quickly moving up tax brackets and are looking for write-offs. 

4.  Any other advice? 

Thanks all, for any help and patience with my complete noobieness. 

[Dave Carpenter]

@Aaron McCurdy welcome to BP! There is a scary amount of information and smart people. I offer neither of those. I did however, just by 2 touchless (no spinning brushes) automatic (no people) car washes myself about 6 months ago, and can to some degree speak to the work and one method of purchasing that business. 

I bought an existing business using an SBA loan. The business was well run, and the maintenance was kept up on. From what I have seen and heard in the industry, that is not all that common. I have gotten into a cycle of going to the car washes 4-5 times per week, usually for a couple hours per day. Each visit entails things like emptying garbage cans and checking on the building. Weekly I am usually doing something like mowing, pulling weeds, combining partially used soap containers, etc. Mostly mindless work, but things that need to be done. 

It is not totally hands off, but does provide flexibility day to day and somewhat week to week. If I need to do something I can go to the car washes the next day or later that day. There are however problems that come up that need to be dealt with immediately. I have a couple people that live nearby that I can lean on if I am out of town. 

Happy to answer any questions on this thread, or speak directly if thats helpful. BP as of now is a little light on the Car wash info.