Virtual Deal Simulator
The Foam Factory Buyout
A regional car-wash manager is buying his first location like it's a strip mall — and doesn't yet know why a tunnel full of brushes doesn't price like retail, or how SBA's 90% stack actually protects his cash.
You’ll Practice
- Explain why special-purpose real estate like car washes is valued through a cost-approach and business-value/real-estate-value split, not general retail sales comparables, because there's limited alternative-use for the improvements
- Size a Total Project Cost into the SBA 504 capital stack: 50% Third-Party Lender first mortgage, 40% CDC debenture, 10% borrower equity injection
- Articulate why owner-user SBA 504 financing lowers required equity dramatically versus a conventional acquisition loan, and what that trade-off costs the borrower in process and guaranty requirements
- Flag car-wash-specific environmental due diligence issues (chemical storage, water reclaim systems, legacy USTs) and negotiate around a Phase I finding without blowing up a sound deal
- Assemble a complete SBA 504 submission package and distinguish documents the CDC and TPL actually need from documents that belong to a different asset class entirely
- Evaluate competing lender quotes on leverage, recourse, and certainty of execution — not just headline rate — and recognize the value of an SBA Preferred Lender's delegated authority on a time-sensitive owner-user closing
The File Lands on Your Desk
Marcus Webb called your office this morning still buzzing. After eleven years managing locations for a 14-unit regional wash chain, he's finally the one signing the purchase agreement: Sudsy Bubble Express Wash, a single-tunnel express exterior wash on N. Mays St. in Round Rock, Texas, three lanes from the frontage road and two miles from a Costco that feeds it steady traffic. The seller, Diane Kowalski, built the business from a single self-serve bay in 2007 and is ready to retire to Scottsdale. Marcus has an LOI signed at a $2,200,000 Total Project Cost — purchase price, wash equipment, and closing costs combined — and he's already told Diane he can close in 30 days using an "SBA loan," though when you ask him what that means structurally, he shrugs and says "my banker's handling it." He hasn't talked to a banker yet. He called you first.
- Target Property
- Sudsy Bubble Express Wash — 1420 N. Mays St., Round Rock, TX
- Buyer/Operator
- Marcus Webb — 11 years as regional operations manager, first-time owner
- Seller
- Diane Kowalski — founding owner, retiring after 19 years
- Total Project Cost
- $2,200,000 (real estate $1,450,000 + FF&E/equipment $650,000 + closing/soft costs $100,000)
- Trailing Revenue / EBITDA
- ≈$1.1M gross revenue, ≈$330,000 EBITDA (unaudited seller P&Ls)
- Financing Sought
- SBA 504 owner-user acquisition loan
- Deal Stage
- LOI signed; buyer wants a 30-day close; nothing arranged with a lender yet