Overview
Net operating income, or NOI, is one of the most important numbers in car wash real estate because it helps lenders and buyers evaluate how much cash the property produces from operations before debt payments. Understanding what belongs in NOI, and what does not, helps car wash owners present a credible financial story and avoid underwriting surprises.
What NOI is in simple terms
NOI is revenue minus operating expenses. It is not the same as cash in the bank, and it is not the same as profit after everything. NOI is intended to measure the property and business performance before loan payments and before certain owner-specific items.
What typically counts as NOI revenue
- Retail wash sales from pay-per-wash customers
- Membership billing from recurring subscriptions
- Ancillary income such as vacuums or add-on services, when supported by reporting
Operating expenses that usually belong in NOI
- Utilities such as water, sewer, electric, and gas where applicable
- Chemicals and supplies required to deliver the wash
- Repairs and maintenance needed to protect uptime and performance
- Labor appropriate for the wash model and hours
- Insurance and property operating costs tied to the site
How lenders adjust NOI
Lenders often normalize expenses if they look too low, especially repairs, maintenance, and utilities. They also review revenue support and may discount revenue that cannot be reconciled to deposits and reporting. The goal is an NOI number that will hold up over time.
Why NOI matters for value and loan sizing
NOI influences value and how much debt the property can support. A wash with stable, verifiable NOI typically qualifies for stronger financing outcomes than a wash with high reported income but weak support or deferred maintenance risk.
Bottom line
Understanding NOI helps car wash owners present a lender-friendly financial picture. The most credible NOI is supported by clean reporting, realistic expenses, and disciplined maintenance that protects uptime.