Coin Op Laundry...
In your experience, is there a greater benefit/liability to provide laundry hookups in each unit or coin-op common facilities for each building?
Benefits for coin-op:
-additional cash flow
-localized potential of water damage (usually in basement where damage is minimal)
Benefits of LDY in units:
-additional rent (varies by location)
Disadvantage of coin-op
-collection of coins
-wear & tear to machines
Disadvantage of LDY in units:
-Multipl LDY location (potential water damage)
-damage to units in moving large equipment in and out
This is my initial analysis. Please weigh in with anything I have missed; am wrong about or thoughts of your own.
Thanks in advance.
I think you need to look closely at your complex's position in the market.
Coin OP <--> Hookups
Students <--> Older People
Low Income <--> Higher Income
Basic <--> Luxury
Decide whether your complex competes on par with the other complexes in the area, or is a cut above or a low-cost alternative. That will drive the decision of whether to go coin-op or go with hookups.
Also, look at it from a risk-management perspective. You may have some responsibility for the security of your tenants if they're in a coin-up facility. A lot of water damage to units is still cheaper than settling just one negligent security rape case. [ Edited by flacorps on Date 12/28/2003 ]
Interesting flacorp; I had not even considered safety issues. THANKS.
The building is a smaller <4 units in a relatively safe area.
I am looking more for peoples own experiences/opinions rather than assessing my property. I will use the info. I gather to then assess the particular property and its specific factors.[ Edited by GlassJoe on Date 12/29/2003 ]
What I have found is that usually it isn't cost effective to offer a coin-op with less the 12 units.
If you do decide to go forward with offering an on -site coin-op, consider contracting with a local laundry company. You may be able to offer them a deal where they will provide the equipment and maintain it, and you get a cut. Usually these deals are split around 50/50. That way, you don't have to learn how to maintain the machines, you still make some cash flow, and your time is free to go after the next deal, instead of dealing with laundry issues. Let soneone else be the small business person.
When you own multiple buildings, you could even setup the equipment in each location and sell the business as a vending route. You should be able to sell it for the cost of the equipment plus around 1.5 or 2 times the yearly net cash flow.
Just my 2 cents.