Car washes near me? Probably. Why investors are building them everywhere in OKC area
It's a wonder there are any dirty cars in Oklahoma City — or anywhere else in the country.
OKC is crawling with car washes — or conveying with them, since the new ones are the automatic kind that use conveyors to move cars through a tunnel. Car wash construction and investment are booming everywhere.
A Google search shows about 150 car washes, old and new, of all kinds, in the metro area.
Oklahoma City alone has added just more than 100 car washes since 2019, city records show. That's when construction took off. The city issued building permits for just four washes in 2018, then 21 in 2019, 11 in 2020, 28 in 2021, 23 in 2022, and 19 in 2023.
But it's not necessarily all because of consumer demand.
"It's absolutely boomed. The real driver has been private equity funds, they're funding it," OKC retail property broker Mark Inman said, referring to pooled investments by companies and organizations that invest for others.
Indeed, "Private equity investor involvement in the car wash industry is at all time highs. Institutional investors and funds have recently come into the sector in both new and monumental ways," according to Car Wash Advisory, a Florida-based consultancy for company mergers and acquisitions.
The car wash industry is booming. What makes car washes such hot investments? It's not like 'Breaking Bad'"'
The proliferation of car washes here and elsewhere has launched loads of social media speculation that they are money laundering operations, as one was used in the hit television series "Breaking Bad."
But experts say no, saying they're better suited as real estate investments and not for laundering large amounts of illegally gained cash. Oklahoma law enforcement officials said drug dealers have other ways to launder their money.
It comes down to legitimate cash flow, said Inman, senior vice president and retail real estate specialist with CBRE Group in Oklahoma City.
Emphasizing memberships rather than one-off washes "guarantees monthly income" making them easier to finance, propelling growth, Inman said.
"That has made it to where these car washes can go after better real estate, and that means better sales," Inman said. "It's a race," with developers posting "coming soon" signs at the first indication of dirt work not only to alert passersby but to discourage other developers from opening nearby.
That doesn't always work. Two are under construction nearly next door to one another near the southwest corner of NW 164 and Western Avenue, with one in operation a mile north at the southwest corner of NW 178 and Western.
Most new washes are eye-catching, with bright color schemes, unusual architecture and lighting.
"There was a shift from smaller, older, low-quality and uncared-for car washes to these large state-of-the-art tunnel car washes. They are cash cows," said Sam Swanson IV, director and president of retail for OKC's NAI Sullivan Group.
With new car washes, membership has its privileges
Memberships made the difference, said Kelley Chambers, director of research for OKC real estate brokerage Newmark Robinson Park. For example, Charlie's Car Wash, based in Salina, Kansas, with washes in Warr Acres and Yukon, has plans starting at $25 per month for unlimited washes.
Cost depends on the level of service. Club Carwash, based in Columbia, Missouri, with 10 OKC-area locations, offers unlimited washes for $20 to $40 per month, compared with single washes from $10 to $25.
"Gone are the days of occasionally stopping by a car wash and pumping quarters into the box to clean your ride — although some of those still exist, but who wants the hassle?" Chambers said. "People want to feel pampered, and the business model is rather ingenious.
"You can't buy a monthly subscription at Chick-fil-A and stop by to eat all you want."
Plus, new automated car washes are fast, he said.
"Full-service washes like Charlie's offer more services and staff, but they can get your interior and exterior done and get you on your way quickly. No hanging around like at a car dealership service center, drinking stale coffee, and watching bad TV," Chambers said.
Can the car wash boom be sustained?
Swanson said construction seems to have slowed recently because of so much competition for customers and rising building costs.
Chambers said retail property brokers at Newmark Robinson Park were surprised that so many new washes have opened the past five years, and that new ones keep opening.
"Can we continue to support all of these? I don't know," he said.
Whether or not there's a glut on the car wash market, Inman said, "It's like any other business. Some are managed well, and some not."
Why the car wash industry is on fire in OKC and across the US
More cars means more cars needing washed, and the number of cars per household is on the rise, according to Mark VII, a car wash equipment manufacturer based in Arvada, Colorado, outside Denver.
Other reasons cited by Mark VII include:
Customer demand for more convenience.
Environmental regulations that discourage people from washing their cars at home.
Car washes are profitable, requiring fewer employees, so a smaller payroll than many other services.
New technology and the membership, or subscription, model.
Sign Up: Weekly newsletter Real Estate with Richard Mize
Senior Business Writer Richard Mize has covered housing, construction, commercial real estate and related topics for the newspaper and Oklahoman.com since 1999. Contact him at rmize@oklahoman.com. Sign up for his weekly newsletter, Real Estate with Richard Mize. You can support Richard's work, and that of his colleagues, by purchasing a digital subscription to The Oklahoman. Right now, you can get 6 months of subscriber-only access for $1.
This article originally appeared on Oklahoman: Why are there so many car washes? OKC industry on the rise
