The car wash craze continues.
Southfield-based Jax Kar Wash, armed with Birmingham private-equity backing, is scouting more than 250 sites for new locations in southeast Michigan and all the way out to Lansing.
Now to be clear, it’s unlikely they will take all of those, or maybe even unlikely they take the majority of them. But that gives an indication of the type of growth the car wash chain envisions in the near future.
The company, now owned by TRP Capital Partners, has hired Detroit-based Stokas Bieri Real Estate to scout for sites, which are a mix of ground-up development properties as well as existing car wash locations that would be purchased and converted into new Jax locations.
Josh Zeid, associate broker for Stokas Bieri, said Jax looks for sites ranging from 0.8 to two acres in size with a traffic volume of at least 28,000 vehicles per day, preferably on a hard corner — although it’s not mandatory.
“I really can’t say how many of those will be going through, but we are partnering with developers all over town to ensure Jax has the best sites,” Zeid said.
“They are hungry and are opening as many as possible,” he said, noting that some of the 250-plus properties are currently under contract.
Jax, certainly, isn’t the only car wash chain expanding now that it has serious institutional capital along for the ride.
As Crain’s Detroit Business’ new car wash beat reporter — I kid, I kid — I wrote about this earlier this month, focusing on El Car Wash, a chain based in Florida that also has a bunch of sites in the pipeline, about 50 in all, after it was purchased this summer by Warburg Pincus, the world’s ninth-largest private equity firm with $73 billion in assets under management, for an undisclosed price.
Warburg Pincus is seeing, in large part, what other PE firms are seeing: An industry that has matured from mom-and-pop shops operating with inconsistent revenue streams to one that has secured a more steady cash-flow system with monthly subscription models.
That has drawn the attention of institutional money, which sees an industry ripe for roll up, much as has happened in industries like self-storage, manufactured housing and marinas, where real estate investment trusts have muscled their way in.
The Jaxes and El Car Washes and others of the world that come into the region and expand will be ones to watch.