Overview
Lenders evaluate new car wash projects differently than acquisitions because there is no operating history. Underwriting focuses on site quality, sponsor capability, budget realism, and the plan to reach stabilized performance after opening.
Site fundamentals are the foundation
Lenders review visibility, access, traffic patterns, stacking capacity, and nearby competition. A strong corridor can help, but the site must convert traffic into customers without bottlenecks.
Budget completeness and realism
Lenders want a detailed budget that includes soft costs and contingency. Under-budgeted projects create cost overrun risk, which is one of the primary reasons new builds get delayed or require additional equity.
Sponsor strength and liquidity
Sponsor experience matters, but liquidity often matters more. Lenders want to see the sponsor can fund overruns, carry interest, and support early operations during ramp-up.
Schedule and execution plan
A realistic construction schedule reduces risk. Lenders also evaluate contractor credibility and whether equipment lead times are incorporated into the timeline.
Stabilization and takeout planning
New projects typically require a ramp-up period after opening. Lenders want realistic projections and a clear plan for permanent financing once performance is demonstrated.
Bottom line
New car wash projects are most financeable when the site is strong, the budget is complete, the sponsor is well-capitalized, and the path to stabilization is realistic.