Why are car washes a great investment? What investors should keep in mind when buying car washes? Why now is the time to buy them? Why have car washes grown in popularity? Melissa Croll, Associate Partner at Attlee Realty, shares her expertise.
Tell us a little bit about yourself.
I’m a car wash real estate broker, and my company has found a great niche in this market. I work with Veronica Attlee, and together we started Atlee Realty about 11 years ago. I’ve been with her for 10 of those years. We also run CarWashTraders.com, an excellent resource for anyone interested in entering the car wash industry. It’s a great place to learn more about the business, get answers to your questions, and explore some fabulous inventory.
I’m personally based in Dallas, Texas, where I focus much of my work, but we’re a national brand. We do deals in other states, including California, Colorado, and New York. We also have a national brand through another company we acquired, called Miracle Car Wash Advisory.
Car washes have been a hot topic with investors for the last few years for many good reasons. From your perspective, why are they a good investment?
The popularity of car washes has definitely grown since I started. We began selling car washes because there was an influx of equipment orders. We were asked by an equipment operator to start doing site selection. In the beginning, we were looking for land, and that eventually led to what we do now—selling existing car washes and everything that comes with them.
What’s really brought car washes to the forefront is the recurring memberships. Every city has its own weather challenges. Here in Dallas, for example, we sometimes get those random freezes that people might not know about. Other markets have a lot of rain. It depends on your market, but these recurring memberships allow somebody to sustain income even during the down times. You don’t need a sunny day to make an income if you play your cards right and build those memberships.
Another reason is that car washes are low-labor businesses, which is part of why they’ve become so popular. With self-serves, for example, you have minimal staffing needs. Of course, you still need someone to pick up trash and ensure everything is working correctly, but not having to hire a large staff is very appealing to investors. The express tunnels need a lot fewer people than opening a restaurant or a retail store.
It’s also a very scalable business. You can start with just one location, then grow to two or three. We’ve seen independent owners grow into national brands. You can either build a portfolio and eventually sell it to a larger group, or build a legacy if you want to keep it forever and pass it down. I have many owners who are buying because they want to create something for their family.
I’d also say the industry is fairly recession-resistant. Everyone wants a clean car, regardless of income level. You want to keep that nice, and we see that across the board, no matter someone’s background. We’re not limited to only the rich washing their cars. Everybody wants a clean car, and that’s helpful. Even during COVID in Texas, it was considered important. At first, officials tried to say that car washing was not necessary, but then they realized it actually was. There’s limited interaction involved; you can go through the car wash on your own, vacuum your own vehicle, and there’s no contact. During COVID, people were washing cars and making money. We can say it’s recession-resistant, and COVID proved that to some extent.
I think sales actually went up during COVID. I noticed two interesting things from my own experience, one in one of our locations, where people were spending their last dollars in their bank accounts to wash their cars, which, to me, was hard to comprehend. But you are right about everybody wanting their cars.
The other day, I was washing my car at another location that had a membership. It was a complete hand wash, inside and out, for $50 per wash, and the lady told me about the membership, which cost $120 a month. Even if she washed her car twice a month, she should have been paying per wash, but she was spending $20 more to be able to clean her car unlimited times per month. I thought, “wow”. She didn’t even need to wash it more than twice a month, yet she was still paying for her membership.
One of the things that I have learned from some of the larger operators is that they usually price their car wash memberships slightly lower than the two car washes. And the reason is, they’re trying to teach or trick the consumer’s brain into thinking, “I washed my car twice, now joke’s on you.” A lot of the bigger operators will do a less expensive package for that very reason, while others do price it higher, so they make a profit if customers don’t come. But overall, I’ve seen a clear trend toward lower membership buy-ins because it encourages long-term loyalty and keeps people from canceling.
What should investors keep in mind when buying car wash sites for building a car wash?
It’s real estate 101: we need to consider our location. This is especially important in car washing, because you have to think about a car wash as an impulse buy. If I am driving down the road and there’s a car wash, I should stop. But if I can’t turn around or get to it, I’m probably not going to turn around and go back. Now, if it’s right there and I can easily get to it, I’m going to pull off and wash my car because it was an impulse buy.
Now, occasionally, someone will say, “It’s Sunday afternoon, I’m on my way to the car wash, and nothing’s stopping me.” But that’s not the bulk of the clients. For most people, it just happens spontaneously. Being at a corner with good access, near a big box store, and in an area where the traffic speed isn’t too fast, ideally 45 miles per hour or slower. If I’m on a highway going 85 miles an hour, I’m probably not stopping for a car wash.
These are all things we look at: ingress, egress, and population. You want to make sure the area can support the car wash. How close is the competition? These are all considerations we take into account, even when we’re selling dirt. And whenever we’re working with somebody to rebuy a car wash, we go through all of this with them because, at the end of the day, we want our buyers to be successful. Hopefully, they’ll continue to buy more, and we love seeing them succeed.
One of the mistakes I made when I purchased these car washes was that I never even bothered to attend a conference, and I didn’t ask anyone how to manage a car wash. What are some conferences and resources people can attend to learn from and meet operators?
We attend most conferences and usually have a booth at trade shows. The big one for us, since we’re in Texas, is the Southwest Car Wash Association. They do it at the Fort Worth Convention Center every year. I believe it starts on February 27. If someone is new, they have breakout sessions with the best operators. They usually have a celebrity guest—like Michael Urban—and keep things fun. They’ll have breakout sessions on topics like whether you should add memberships, self-serve options, or in-bay systems. All your questions can be answered. There are tons of resources available, and you can see all the latest and greatest equipment—all the AI stuff out there—which has really changed the game.
I was actually talking with one of the operators who runs several car washes here in Texas called Cowboy Car Wash. He was saying that with these new apps, he can monitor when they’re busy. For example, he’ll say, “I only need one or two guys during this time, but between 10 a.m. and whatever time there are the most customers, that’s when I need three guys.” He can really evaluate his business. He can also track his chemicals, like when this barrel is getting low or if it seems like they’re using too much of a specific chemical. Is there a leak or something? What these apps and other technologies can do is incredible.
And those are the things that they could learn about at these trade shows. It’s worth attending the Southwest Car Wash, and there’s the NRCC, which just passed; that one’s in New Jersey. Another big one is coming up in April in Nashville. It’s probably the largest show, and it alternates between Nashville and Las Vegas every year. But that one’s pretty central. There are several others spread out across the country. Depending on where you are, you can usually find a trade show or training event near you.
Also, Sonny’s Equipment does a car wash college. They also host webinars and in-person sessions where you can learn. As a broker, I went and sat because I was curious, and it was very informative. I would recommend something like that to everyone. Most equipment operators have some training. They’re probably going to try to sell you on their equipment, but they’re going to teach you something along the way.
We’re in October 2025 right now. Why is now a good time to buy car washes?
I will say there’s a sense of urgency right now for many people. As you know, this year they passed the Big, Beautiful Bill, and this is huge for our industry. We’re back to 100% depreciation, and you can take advantage of cost segregation. What that means is you can write off equipment and similar items, which can save significantly. I literally have people coming to me now in October trying to close before December 31, saying, “I need to close so that I can get some tax write-offs.”
It also helps you, in the long run, with scaling your business. For many reasons, I’d say there’s a sense of urgency right now. If you want to take advantage of buying a car wash and benefiting from that tax law, you need to do it now because a car wash deal can take 30 to 90 days to close, so we’re really at that point where, if you’re going to get it done, you need to be going under contract now.
I believe car washes have the highest bonus depreciation of all real estate asset classes. Is it 90 percent?
Yes, it’s very high. They say car washes and convenience stores—if I’m not mistaken—are two of the highest. When people think of cost segregation, car washes are at the forefront. I even work with a gentleman named Tom Brody, who actually does cost segregation reports for my listings. It’s fascinating because I can share those with my buyers and say, “This is what your savings could look like. It’s significant.” When I send that information to people, it’s funny that we get associated with Breaking Bad. They ask, “Is this legal? Are you money laundering?” I always tell them, “No, I promise. This is 100% legal. There is a tax code to support it. In fact, the IRS likes this. It’s okay.”
Obviously, you’d want to work with somebody like a Tom Brody or your CPA. You want to get someone involved who knows the ins and outs and can run the report correctly. Even if we close on December 31, you can still run the report afterward in case it happens in 2026. You have to close by December 31, 2025; otherwise, it will be reported on your 2026 taxes.
It’s pretty incredible. As for bonus depreciation, we just closed on an industrial building with investors, and their tax break is expected to be around 50-60%. It just goes to show how huge a difference that is compared to car washes. Send your tax problem to Melissa and see which car wash may be the most beneficial for you.
It basically covers everything except the land, especially with a car wash, because the equipment does depreciate. You do have to replace parts and other things. That’s part of why it’s so high up there. Like you said, a lot of the parts are going to wear and tear.
Why have car washes grown in popularity over the last few years? Everybody has been talking about them.
Again, a little bit of it is due to memberships, but I think a big part is awareness. Back in 2022, The Wall Street Journal published a few articles about buying express tunnels and their potential profitability. I’ll say that was both a blessing and a curse. We got very busy, and people had a lot more knowledge that you could buy a car wash. But everyone thought, “You buy an express tunnel and you’re going to make a million dollars.”
There’s a lot more to it than that. You don’t just open the doors. It’s an experience. You have to think about a car wash as a service. If someone goes through and has a bad experience, just like in a restaurant with bad service, they’re probably not going to come back. That’s why maintaining great customer service is so important.
I always recommend that express tunnel owners have someone stationed at the front to greet customers. Not only does it make the experience better, but if the greeter is friendly and efficient, they can also control the POS and help keep the line moving. If I’m sitting there trying to figure out, “Where do I put my credit card?” I don’t know if you have someone there keeping that flow going and, at the same time, upselling memberships, which is huge. I think consumer knowledge of the space and the excitement that comes with it has really triggered growth.
And then, of course, we’ve had an influx of PE money, which is no surprise. When PE money started coming in, it began expanding, and we’ve seen chains doing a lot of M&A. But for the individuals, I think they heard about a business that they thought they could do without a ton of employees. Yes, you need employees and staff, but not as many as you would if you were opening an Italian restaurant.
These car washes have lines of cars, even on a weekday in Rio. If you can get managing it right, or if you have the right team, I think it is a fantastic asset class.
Automation has been significant, and one of my operators swears by hiring people who have worked in a fast-food restaurant. It’s very repetitive, and so they’ve had a lot of success with hiring people from that field.
Is there anything else that we haven’t covered that you think is important for our audience to know?
The takeaway is that if you’re trying to take advantage of the cost SEC for 2025, I’d get on that sooner rather than later. Consult your CPA or your tax experts about the Big, Beautiful Bill. It’s really unbelievable what they’re allowing us to do. I’m excited about where the car wash world is going. I don’t think we’re slowing down. I get asked that question a lot. I’ve had one of my busiest years ever. Our company as a whole has had our best year ever.
Melissa Croll
melissa@attleerealty.com
https://www.instagram.com/carwashprincessmelissa/
www.carwashtraders.com