“Houlihan Lokey’s market update on the U.S. convenience-store and car wash sector provides an institutional investor’s view of the space. The report tracks how fuel, in-store merchandise, and car wash revenue each contribute to overall profitability, and it emphasizes the importance of growing non-fuel income as fuel margins remain volatile. It also reviews recent transaction activity, including portfolio sales and single-asset trades, to illustrate how investors are pricing high-quality assets versus more challenged locations.
One of the key themes is the sustained interest from private equity and infrastructure capital. The report notes that the sector has seen periods of record M&A activity, with strong operators and branded platforms commanding double-digit EBITDA multiples. At the same time, higher interest rates and increased construction costs are forcing more discipline in underwriting and creating a gap between buyer and seller expectations in some cases.
Owners and operators can use this analysis to benchmark how the market might view their own portfolios. Sites with modernized stores, strong car wash offerings, and reliable fuel volumes are best positioned to attract premium valuations, while older or underinvested properties may require repositioning or capital upgrades to unlock their full value.
Read More: https://www2.hl.com/pdf/2024/us-convenience-car-wash-sector-market-update-fall-2024.pdf
