All Forum Posts by: Dave Carpenter

@Levi Crawford not sure how I missed this post. Did you go through with the purchase?!

There have been some decent threads on BP about buying car washes. 

There are also some forums and Facebook groups that have tons of info. Talk car wash on FB is one of the biggest and has tons of good info. 

I don’t know of any lawyers in the area, but the topics he’s hitting are great points. Washes will likely need an environmental survey that can be complex. 

a great person to connect with would be a chemical supplier. If you find a good one, they will know lots of people in the industry and likely some info on that wash. 

there’s also some good threads about others that have looked at buying washes. 

@Patrick Britton thanks for the feedback. This is exactly what I’m trying to sort out. I want to buy assuming long term rental rates or signed leases for office space in case something we’re to change with Airbnb.

You’re right, with the projected Airbnb numbers this is a slam dunk, but I also and thinking about exit. If I can only sell this down the road as a generic office space then I can’t buy with Airbnb numbers.

I’ve had conversations with a local bank who is interested and is supposed to be reaching out to their appraiser for guidance on how it would appraise.

You all make a good point about not expecting them to use the income approach, though it is not a residential zoned building, there is an upper unit that’s a long term rental.

Thanks again for the insight!

@Joshua Strickland they makes sense for a SFH, the building I'm looking at is zoned B1 and was previously a medical practice.

@Steven Goldman

That’s helpful info, thank you! You are right, I’m concerned about the appraiser looking at comps for a generic office space (which would bring in less revenue) compared to other nearby buildings with short term rentals.

Looking at specialty lenders is an idea. Any you’d suggest?

My original hope was to buy using hard money and have the appraisal come back strong enough to BRRRR out of the property, or come close.

@Joshua Strickland

Thanks foe the suggestion. All signs seems to suggest in the city it’s ok, but I should confirm.

Any insight on the appraisal side after it’s up and running?

I'm looking at a building that is zoned B-1 business and plan to convert it to 3 airbnb units. Once the build out is complete, how would an appraiser value the building given that use? Would they use comps for other B-1 buildings of similar age and Sqft or consider its use? I'm concerned that appraisers aren't familiar with this type of use and will opt for a generic business use. Any insight from those who are appraisers or have airbnbs?

any posts are a few years old at this point.
Thanks!

@Stephen Brown

For starters, find local chemical distributors and call a few of them. They know the market and might have insight on volume the wash had done and the condition of the building and equipment.

I’d look into traffic count and speed of road. Is there a stoplight that keeps eyes on your location a bit longer or so people fly by at 55mph?

What is the population within 3 or 5 miles? Thats where your customer base is.

A good chemical rep should be able to offer you insight on traffic and population.

This data will give you a sense of volume.

A working wash that’s operating regularly should be valued loosely at 3-5x yearly gross sales. In this case, I’d anticipate discounting with that as a sterling point.

Also consider what the costs will be to get it up and running.

On the back side, know you are building a business not a passive investment. It may not be a full time job, but someone will need to be there at minimum most days of the week.

Good luck!

@Drew Petro where do you stand on this opportunity right now? Still moving forward with it?

I’d add 2 quick points:

1. Most equipment has a practical life of more than 10yrs. I’ve got equipment that was installed in 2002 and is starting to get a bit worn out, however there are still parts readily available and the machines work just fine.

2. There are basically 3 types of washes. The simplest are self serve. That’s the spray wand where you wash the car your self. The there’s IBA (in bay automatic) these are the drive in and park. The third is the tunnel. Employees are required full time only for tunnels. Each model is very different and goes from least hands on (self serve) to most hands on (tunnel)

Just want to make sure we are all on the same page in these discussions.

@Craig Garrow let us know when you have some numbers. Car washes and laundromats can be nice part time businesses, but all depends on numbers and condition.