All Forum Posts by: Dave Carpenter

@Tato Corcoran I have 1 door, my front door. All I own in Cedarburg is my personal home. I’d love to buy rentals here, but the price is too high for the rent. It’s a great city and great schools!

@Tato Corcoran congratulations that’s a great area! I’m assuming you have someone lined up to turn the unit between guests? I can’t speak too well for the Airbnb market in that area, but you are close to the medical college of WI and plenty of businesses in Milwaukee and out towards Wauwatosa and Menomonee falls.

Also, for what it’s worth (and if you haven’t seen headlines yet) the DNC will be holding their convention next July. You may want to consider pricing for that week since the demand will be just a tiny bit higher...

@Fred Johnson could explore renting out to a detail shop. I’ve heard of people converting them to laundromats if the market supports it.

Marcus, I never considered the seniority piece about existing tenants. It’s a great point and something to consider when buying occupied properties!

@Angela Doyle I’d explore SBA loan. You can do 20% down with no experience. Thats what I did. Still doesn’t get you all the way there, but maybe the seller would be willing to finance some of it. My seller didn’t have his paid off either, but had enough equity to take 10% in second position as a loan.

Technically SBA doesn’t allow you to pay a second position back for the first 2 years, but there are things you could do to pay the seller back within the first 2 years.

Your husband doesn’t have to know everything, just be logical and willing to learn. If he has some time and flexibility you could make it work.

Give lots of consideration to the equipment. There is a Facebook group called “TalkCarWash” that would be very helpful in evaluating what you have to work with. Old equipment is going to take a lot more work.

You can do this...if you want it!

That’s exciting! Taking on 3 car washes would be a lot of maintenance work. Much of which you could do yourself. Are you or some one you know pretty handy? A relative that would love some side money fixing things might come in handy. Owning a car wash means you need to know plumbing, electrical, mechanical, and when to call the experts. It’s not always easy, but you will learn and if you have good relationships (especially with the suppliers and maintenance folks) you can certainly do it! 

I’d encourage you to figure out what the sellers goals are. If he’s older I’m guessing he wants to get out of the business. If that’s the case seller financing might help him accomplish that goal. I’d guess being fully out vs 2/3 out would be attractive, maybe enough for him to help you get there by financing a portion of the purchase price. 

@Angela Doyle

A few things to consider

Type of wash- I’m guessing these are self serve with the spray want or in bay automatic where there are no employees needed.

Traffic flow-does the traffic flow and the businesses right near the wash support these incomes and any potential growth.

State of the equipment-is the equipment newer or older, is it well maintained?

Income over many years-weather plays a big part is the success of a wash, you want to see REAL numbers for st least 3, more like 5 or 7 years to get a better picture.

Sellers mindset-is he really selling 2 of 3. If he is getting older and wants to get out, you may be able to take over all 3 at the same time. You will get efficiencies of scale with chemicals and service calls.

Suppliers-talk to his chemical supplier and maintenance guy. These two people can make or break your car wash. They know everything about them and you will come in knowing next to nothing.

cash-is he reporting cash/coins from self serve bays and vacuum. If he is, great, you have s good picture. If he’s not, you should still do your numbers assuming there isn’t any other income. He can’t prove it and neither can you.

I’m sure there are more, but that’s a start. I’m glad to chat more if you would like!

Tyler, no I didn’t. Property was bought by a family and they build a nice big custom home on it. 

I’ll be curious to hear how your purchase and split goes!

I know this is offline a little, but curious @Rebecca Knox what about the Habitat areas are difficult? Is it that you have a bunch of new houses but without traditional sale prices, so using as comps is hard?

The first thing that comes to mind is commercial as a whole is a different world than residential. I own a couple car washes as well as duplexes and they are totally different businesses. If you could find a partner that knew self storage maybe in a different city or state and could provide insight on the business side you could run the operations on a local level and lean on them at the industry level. 

Also, it sounds like you have a unique advantage in new construction cash flowing rentals through your business. Doing one of those a year for 5-10 years would set you up quite well. Kind of a “if it ain’t broke don’t fix it” situation.