Has anyone had experience with gas stations?

High insurance coverage, but......

Assume if its in a great area, it will always be busy and you'll make a mint

Make sure you have a great attorney to overlook everything.

Location is everything

fuel is sure to rise( likely to be dramatic) along with the rise in food and hyper inflation. It would sure be nice to be on the right side of things when the hyper inflation hits... won't be long!

Maybe ask some local owners, I'm sure there's a lot to learn with something like that.

Thanks.
Elix, I have heard that gas stations' underground tanks eventually start leaking and have to be replaced. The runoff can end up harming other properties as well. Something to watch out for when buying multifamily properties!
Thanks you two!

RENinja

My Very good Friend has owned a Gas Station for many years...I seen all his bills to refill the his fuel tanks..Lets say he paid $4 a gallon but gas is selling for $3.50 gal...You do the math..He loses every time cuz gas goes up and down..He had to rebuild his station so he could add a Tim Hortons to help pay the bills

When I was learning Tax Sales, one of the warnings about buying gas station liens/deeds was "environmental issues". You may want to make sure that there are no issues pending. Also, underground tanks are prone to danger if they are in an area that has unstable ground ie: frequent tremors, sink hole activity, excess standing water. Just check out every possible disaster scenario to make sure you are safe.

Just a thought...

Andy Sager
DG's AndyS

Yes, I have been to them hundreds of times! In the past few years I go there to fill my RE business vehicle with fuel so that I can go out and look at and evaluate properties.

Michael Mangham
MD Home Acquisitions LLC

Good one Michael We used to do that with a CB radio Check. People would respond " I got mine! " lol (Oops, I may be dating myself )

Andy Sager
DG's AndyS

Thanks for your thoughts michaelmangham, conquesttsi89, and AndyS.

RENinja

that are infastructure is getting very old, and so when talking about possible environmental problems, they could be on the rise.

It can be a nightmare. We just had underground tanks removed from a property we had owned and sold. It took over 2 years for everything to be completed because of the bueracracy, (I know I butchered that word) lol. I am in the fuel business. You need to keep your margin or you won't be in business very long...our company has been here since 1938. This is the only business you could go to work in the morning and actually loose money by the end of the day if the prices start going crazy. Petroleum used to move in pennies now it's a 10 cent swing! Stick with RE and stay away from environmental headaches!

Thanks for the input. I knew that it would sorta be like running a mini walmart. Thats what I wanted to know.
Thank you!

RENinja

gas stations can make great investments for the long haul. The biggest problems/costs are inventory control, leaking tanks, insurance and personnel. The best news for you is that your state has the loosest environmental laws on the books. If your tanks are metal; really think about if you want to buy. If your tanks are fiberglass it is a plus. Other questions would depend if it is links with a major oil company, if it is a convenience store, how many pumps, daily car count, good financial records for 2009, 2010 and 2011 to date, does it sell alcohol and/or lottery tickets, how many robberies over the last 5 years and what type of neighborhood it is in. Hope this helps.

the real profit would come from in store sales like candy chips pop and other stuff on your shelves.

Thanks for the comments. TrustPoint, my mom says the station has been there for ten years. My guess is, that the tanks have started leaking and the owner doesn't want to deal with it. The other thing is, its 100ft from two other gas stations, one that has just been reopened two weeks ago with a in-house restaurant.
The asking price is 980,000. TrustPoint, how would I calculate the value of a gas station?