Hello. I’m really interested in getting into the laundromat business so as to diversify away from just having real estate in my portfolio. Since I am new, I’m having trouble trying to value a potential deal. I have done a lot of research, but would like to know the thoughts of more experienced owners.
The unit currently looses money and the equipment is about 15 years old ( allthough working, other mats which may compete have new equipment). The facility is cosmetically in bad shape. The location is in a prime area with a high concentration of lower income apartment complexes on a well traveled street. There is another mat 2-3 miles away, fully remodeled, new machines and decor which seems to be an ideal setup. I would assume this is a profitable mat, but the one I am interested in is located closer to the nearby apartment complexes.
In my opinion this mat could be profitable with a remodel and replacing the majority of the washers. Due to it being on a well traveled street, some advertising of wash and fold I think could drive in a significant amount of new business.
How do I value a money loosing mat with old equipment that will need to be replaced? I do see value in the current infrastructure on the leased property, and the physical location, but not anything else.
Thanks in advance!!!
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