All Forum Posts by: Jordan Berry

Hey @Frank Salvatore Enzerillo, you're speaking my language here. I'm a laundromat and commercial real estate investor in CA. There are a lot of factors here. I'm assuming you're just buying the property only, and not the laundromat or any other business in the center.

I can't speak to what a good cap rate is in your area, but you should be able to speak with a broker or even browse around online to find out if it's in the ballpark for that area. The financing sounds like it's a pretty good deal. One word of wisdom, the seller might be pitching it like they are giving you this great deal on financing. It might very well be, but just remember that it benefits them greatly, too. So don't let them make you feel like they are doing you a favor.

Here are some things to consider: What kind of area is it in? Is it a lower socio-economic area? What's the crime rate like in the area? Is the area run down or kept up pretty well?

What conditions are the stores in? Are they run down and beat up, or are they clean and kept up?

Laundromats can attract a homeless population. Just something to be aware of. Do any of the other businesses in the center attract clients that might keep people from using those businesses? Ultimately, if the businesses don't succeed you won't succeed as the property owner. 

What do the leases look like with the businesses? How long is left on them? Are there any vacancies foreseeable in the near future? Are there opportunities to generate more income through raising rent?

Have you spoken with the city about what it would take to sub divide the land? Why hasn't the current owner done that yet?

How strong are the financials of the businesses in the center? Do they make payments on time? Are they struggling? Is there any reason to think they are going to ask for a reduction of rent in the near future?

These are a few things to think about and some information you'll need to find out before you commit to this. Let me know if you have any other specific questions. I'd be glad to help where I can.

@Michele King Laundromats would definitely be much less work than running a general contracting company, haha. I'll DM a link to my website that has a bunch of free information and resources for laundromat owners and prospective owners. That should get you started determining if you think it's a good fit for you or not. I would be glad to answer any questions you have about them, too.

@Travis Harden It really depends on the location and size of the laundromat. There are definitely laundromats that net far more than that in my market, but I'm in Los Angeles, which is essentially the laundromat capital of the world haha. Many net less, but $50,000-$70,000 net is pretty common for an average sized, well-run, and unleveraged laundromat. Leveraged, the laundromat would have to bring in far more gross income, obviously.

I'm not in equipment sales. I'm a multi-store owner myself, and I run a website with a bunch of free info and resources for laundromat owners and prospective owners. Let me know if you want to take a look and I'll DM you the website. They don't like it if I post a link in the forums :)

@Jeff White @John Mayer Orrrr, with that $300k you could buy a laundromat and expect to net between $75,000-$105,000 per year, unleveraged... ;)

@Zachary Beach Awesome, I'll DM you some info!

@John Mayer If you're looking for cash flow and you have 5ish hours a week free (usually less, 1-2 hours typically), I would recommend a laundromat. I own a couple and the cash flow is tough to beat. I have the top blog post on the Member Blogs page for this month arguing that if you're looking for cash flow, real estate is not the optimal vehicle (although I am a real estate investor and am buying real estate, as well). With a laundromat you can expect 25-35% cash on cash returns unleveraged, and more if you leverage.

Let me know if you have any questions about it I can answer. I also have website for laundromat owners and prospective owners that has a ton of information on it for free if you're interested. DM for the link if you want.

@Zack Thiesen I posted a link to the Bigger Pockets page that has the article and it was removed. Sorry. I'll DM you and anyone else interested in reading it. Let me know if I can answer any questions. I'd love to hear what you think about it if you get a chance to read it. Thanks man!

@Obi E. Hey Obi! I'm a multi-store laundromat owner. I'd be glad to answer any questions you have. 

In terms of some basics to know, I'd say

1. make sure any laundromat you consider buying is in a great location with renters in the area and good visibility

2. know the condition of the machines, plumbing, electrical and boiler before you buy

3. Make sure you have a reasonable, long-term lease in place before you buy

4. And perhaps most importantly, utilize a knowledgeable, experienced third party (whose income doesn't depend on you purchasing the laundromat) to help you through your first purchase at least. Unfortunately there are still a number of untrustworthy laundromat brokers and owners out there who take advantage of newbies (not all, but enough that it makes it worth it to have someone double check for you)

Let me know if you have any specific questions or need some input. Good luck!

@Christina Linn congrats on the laundromat! I'm a multistore owner and currently have a top member blog post showing how the cash flow from Laundromats is the fastest way to financial freedom. So obviously I think you're a genius :)

Let me know if you have any questions that come up that I can help with. I've been in the industry for a while. 

Best of luck expanding that portfolio! And again, I'd love to be a resource for you if you need anything!

@Jack Daw I own a couple of laundromats and I think that would be an interesting asset for you to look into at that amount of capital. I have found the cash flow from laundromats to far outperform that of most real estate investments pound for pound, especially in your area. 25-35% unleveraged is pretty common. I wrote a member blog on it last week and I think it's the top member blog this month if you want to check that out. 

I own a couple of laundromats in LA. I also run a website for laundromat owners and prospective owners with a ton of free information and resource. PM me if you want the link. I'd also be glad to answer any laundromat and/or commercial real estate related questions that come up.