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Appraisal Of An Oil Change Facility

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Patrick Smith

Freshman Member
Joined
Mar 18, 2003
Professional Status
IT Professional-Appraisal Related
State
Michigan
Has anyone appraised an oil change facility? (ie: Quick Lube, Quaker State) So far, I have turned up a number of sales (all to owner-occupants), but no rental data. This type of property seems similar to a gas station or party store where an income approach could be applied based on a percentage of gross sales. In addition, it seems like gross sale levels (if I can get the numbers on the comps!) would be helpful in adjusting the sale comps. So...that's the direction I'm headed for now. Any comments would be appreciated. Thanks!
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
You doing a real estate appraisal, or a business appraisal?
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I have seen a number of these sell, but is always hard to separate the inventory, real property, and goodwill. Basically, I had to interview a person on each sale that knew how much was inventory, how much was building, etc. I would go the personal interview route.

I saw one property impacted by the move of Wal-Mart from across the street to the other side of town....it ain't gonna make it I'm afraid.
 

Patrick Smith

Freshman Member
Joined
Mar 18, 2003
Professional Status
IT Professional-Appraisal Related
State
Michigan
I'm a bit further along now... What I've found is that several of the sales were consummated subject to an ongoing supply agreement with the parent company (ie: Valvoline/Quaker State) and at least one sale had guaranteed financing from the parent company (reportedly due to too much use value for this property type and too little market value). In most cases, allocation to business value seems a bit arbitrary and the various machines/equipment can add significantly to the purchase price. (Just $5k for a pro transmission flusher - don't need that in my garage!)
 
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