Express tunnel space is growing in Australia

What are the trends of the australian carwash market? We speak with Rory Hilton from Car Wash Sales and Advisory, Australias only National real estate agency servicing the car wash market.  “Our country is heavily weighted towards the self-serve and in bay automatic market however there’s growing interest in the express tunnel space”. We’re significantly lagging international markets such as the US and Europe, however with underlying pressure on land value in the real estate markets, we expect this to potentially force a rethink on current designs to develop the most efficient footprints for the car wash space.

Can you tell us something more about the Australien carwashmarket?

“It’s a severely fragmented market that hasn’t yet gone through consolidation. It’s an extremely popular investment sector however limited by available data. Our business – Car Wash Sales and Advisory is a relatively new business and focussed on delivering informed data to drive increased sales and pricing outcomes so the investment, funding and development market can make more informed decisions, which in turn will help increase the investible space.”

What do you notice?

“It’s still heavilty influenced by the fuel supplier market, not dissimilar to Canada, however the independent car wash market is signifcantly more lucrative and is now moving away from manual / self serve bays to increased automation of both touch free and roll over options, along with the emergence of the express tunnel market.”

Which evolutions and trends you see?

“Increased demand for convenience as people are becoming more time poor, which will continue to drive investment decisions around wash models and development feasibility. We are starting to see this now with refurbishments of exitsing sites adding more automation and increased demand and growth through the express tunnel space.

How do you respond with your company on the evolutions?

“We are building a data set to enhance customer decision making processes, educate buyers, funders, valuers and owners alike. We expect this to allow new, and larger pools of capital to enter the space, which will eventually lead to consildation/roll ups/Private Equity injection, much the same as more mature sectors like Self Storgae and Childcare. Our company is striving to grow the investible space by supporting investment decisions with data to allow the scetor to be a standalone invetsment sector in Australia.”

What is your focuss?

“We are focussing on demographics and trade catchment analysis for existing sites and also new development pipelines, overlaid with financial information for each location to enhance customer decision making processes and grow the investible space… We see the space as showing similar signs to what the self storage and childcare investment space showed in Australia 15 years ago. Both these spaces have grown significantly and now evolved through a growth cycle and are heavily invested in by Institutional capital and more sophisticated investment houses”.

-How it wil developp in the future?

“We expect to see similar trends that have played out in the US and the trends that are currently playing out in the Canadian market. The fight for land, development costs etc will force car wash businesses to either enhance their offering, or lose the land opportunity as they will no longer be the highest and best use. We expect this to come through continued automation and convenience focussed outcomes.”