SBA 504 Car Wash Feasibility Study Case Study: Express Tunnel New Build in Mint Hill, North Carolina

A 100-foot express exterior tunnel on a 0.842-acre grocery-anchored outparcel at NC 51 and NC 218, financed under SBA 504 as a special purpose property operated by a new business. Total project cost of $5,111,214, debt service coverage of 1.15x in Year 2 and 1.62x in Year 3, and a written determination of feasible, subject to two conditions precedent.

Model study prepared by MMCG Invest | Michal Mohelsky, J.D., FMVA | October 1, 2026

MMCG concludes that the proposed 100-foot express tunnel car wash at the Blair Road and Fairview Road outparcel in Mint Hill, North Carolina is feasible as proposed under an SBA 504 structure of 50 percent bank first lien, 30 percent CDC debenture and 20 percent borrower contribution, with a financial reserve of $343,000 funded at closing. The Project reaches 1.15x debt service coverage in its second operating year and 1.62x at stabilization in Year 3 on a membership base of 2,800, which is below the 4,000-member level at which industry data shows retail-to-member conversion accelerating. The determination is conditioned on two items that public sources could not close: a Town of Mint Hill zoning verification letter confirming that a car wash is permitted on the parcel, or the approval of a Conditional District rezoning if the parcel lies in the DO-B Downtown Overlay, and NCDOT station counts confirming traffic at or above the 11,500 vehicles per day used as the underwriting basis on NC 51. The determination does not depend on any traffic figure above the lowest published count.

This is an MMCG model study: a complete feasibility analysis performed on a real, publicly marketed parcel using public data, prepared to show lenders and borrowers how MMCG underwrites an SBA 504 express tunnel. It is not a client engagement, MMCG has no relationship with the landowner or the listing broker, and the analysis does not represent an offer, an appraisal or a recommendation to buy the parcel. Figures drawn from government sources, operator websites and the listing are identified as such. Figures labeled MMCG assumption are underwriting inputs set by MMCG from industry benchmarks, and items that could not be verified from a primary source at the study date are listed in the Conditions and Limitations section rather than estimated silently.

The Project will operate as a 100-foot express exterior tunnel car wash under an unlimited monthly membership model on the 0.842-acre outparcel at the entrance to Whitley Commons, a 38,944 SF Food Lion anchored neighborhood center at the junction of Blair Road (NC 51) and Fairview Road (NC 218) in Mint Hill, Mecklenburg County, North Carolina. The physical program comprises a single-story 3,800 SF masonry tunnel building housing a 100-foot conveyor with friction wash arches, high-pressure rinse, a protectant and drying package, a mechanical and chemical room and a staff office with customer restroom, served by two automated pay lanes with license plate recognition and a dedicated member lane, a stacking capacity of approximately 24 vehicles across both lanes, 18 free self-service vacuum stalls under a steel canopy fed by a central vacuum system, and a water reclaim system sized to recycle the majority of wash and rinse water. The wash will operate seven days a week from 7:00 a.m. to 8:00 p.m., within the 6:00 a.m. to 10:00 p.m. operating window the Town of Mint Hill has accepted for an express wash in town, with a general manager, an assistant manager and 5.5 full-time-equivalent attendants for a total of 7.5 FTE. The borrower will hold the land and building in a real estate holding company that leases the facility to an affiliated operating company, the eligible passive company and operating company structure SBA permits for 504 projects. The Project is positioned as the newest express tunnel serving the NC 51 and NC 218 junction, with a membership price ladder of $24.99, $29.99, $34.99 and $39.99 per month that sits between the $24.99 ride-through plan published by Autobell and the $30 to $40 club plans published by Sam's Xpress, and with retail single washes from $12 to $22.

Marketing and Sales Strategy

The launch is anchored on a 30-day grand opening with free top-package washes for app registrants, converting first visits into memberships through license plate recognition at the pay station and a first-month introductory price. The co-tenancy with Food Lion places the wash on the daily grocery trip of the center's shoppers, and the outparcel's position at the center entrance gives it the first curb cut that center traffic passes. Ongoing acquisition runs through geofenced mobile advertising within three miles of the site, a referral credit for existing members, and family plans that add vehicles at a discount. Business outreach targets fleet memberships for the contractors, home service companies and dealerships operating along the NC 51 corridor, billed monthly to a single account. Retention is managed through card-failure recovery messaging, a pause option in place of cancellation, and plan upgrades offered at the pay station.

Amenities

The subject is a 0.842-acre outparcel (36,677 SF) marketed by New South Properties at an asking price of $498,000, reduced from an earlier asking price of $525,000. At the current asking price the land basis is $591,449 per acre, or $13.58 per SF. The listing describes the parcel as a prime outparcel at the entrance to the Food Lion anchored Whitley Commons with highly visible NC 51 frontage. The site lies in the Town of Mint Hill, which administers its own Unified Development Ordinance, and is served by Charlotte Water, which supplies Mint Hill, Matthews, Huntersville, Cornelius, Davidson and Pineville.

The parcel size governs the format. A 100-foot express tunnel with two pay lanes, stacking and 18 vacuum stalls fits a site of this size; a comparable express wash marketed in the Dallas-Fort Worth area operates a 100-foot tunnel on a 0.85-acre lot. Express car wash rezonings filed in eastern Mecklenburg County for longer conveyors were sized at 1.66 acres (Petition 2021-273, 5706 Wyalong Drive, approved August 15, 2022) and 1.59 acres (Petition 2022-124, 5323 Prosperity Church Road). A 130-foot program would require land the subject does not have, and this study underwrites the 100-foot program accordingly. The final site plan must confirm stacking, vacuum placement, the residential setback and drive aisles before the equipment package is ordered.

Published traffic counts for the subject junction conflict, and no NCDOT station identifier with a count year was retrievable from the public map service at the study date. The underwriting basis is the lowest current figure on each road.

On the underwriting basis, the junction carries approximately 27,500 vehicles per day across both roads. Year 3 volume of 307 cars per day equals 1.1 percent of that combined count; the figure is reported as a cross-check on scale and is not used to derive demand. NC 51 is programmed for widening under STIP project U-5007, which is split into segment U-5007A (Matthews Township Parkway to Lebanon Road, $38.8 million) and segment U-5007B (Lebanon Road to Lawyers Road, $113.4 million), and is shown in the most recent draft program as funded for preliminary engineering only. A future widening could bring right-of-way acquisition and median control at the frontage; no funded construction is shown within the study horizon.

Mint Hill regulates automatic car washes in Section 6.9.7(A)(15) of its Unified Development Ordinance. In a commercial or industrial district an automatic car wash must comply with the yard requirements for accessory uses, may not be located within the established front yard, must observe a 20-foot setback where it adjoins residential zoning, and must comply with the provisions of Section 7.1.11, which sets the use-specific standards for automatic and self-service car washes. Mint Hill amended its Downtown Overlay in 2018 (case ZC18-8) so that car washes in the DO-B district are permitted only through a Conditional District rezoning. The zoning district of the subject parcel and its overlay status were not verifiable from public sources at the study date.

The town's most recent express wash approval sets the practical terms. Board of Commissioners minutes of December 14, 2017 record the approval of Sam's Xpress Car Wash with operating hours of 6:00 a.m. to 10:00 p.m., six staff members per shift, and an applicant representation that 90 percent of the water used would be recycled; a related 2018 rezoning tied an adjacent lot to the same site. The Project adopts hours inside that window, a reclaim system, and vacuum placement oriented away from any residential edge. If the parcel lies in DO-B, the Conditional District process adds a Planning Board recommendation and a Board of Commissioners decision with public notice, and the pro forma carries the resulting delay inside the construction schedule rather than as a cost overrun.

Charlotte Water's fiscal 2027 schedule, effective July 1, 2026, sets system development fees for a 2-inch meter at $11,622 for water and $40,525 for sewer, a total of $52,147, about 4.0 percent below the fiscal 2026 total of $54,296. A 1.5-inch meter carries $32,592. The water connection is priced at cost after the Site Utility Plan is reviewed; this study carries an allowance of $38,000. Volumetric charges are $3.65 per Ccf for water and $6.88 per Ccf for sewer, with a non-monitored high strength charge of $3.30 per Ccf and an industrial waste charge of $0.465 per Ccf applied to 100 percent of incoming water for commercial customers. Charlotte Water had not confirmed whether the high strength charge applies to car washes, and the model applies it.

The water budget starts from the EPA WaterSense benchmark of 30 gallons of fresh water per vehicle for conveyor washes. At 30 gallons and the all-in rate of $14.30 per Ccf of 748 gallons, water and sewer cost is $0.57 per car, or approximately $64,000 at Year 3 volume.

Charlotte Water has operated under mandatory Stage 2 drought restrictions since May 15, 2026 and confirmed in September 2026 that Stage 2 remained in effect. Stage 2 prohibits discretionary vehicle washing at home and expressly permits commercial car washes, which shifts driveway washing to professional washes during the restriction period. The treatment of commercial car washes under Stage 3 was not published in a primary source at the study date and is carried as a risk factor.

The primary trade area is the Town of Mint Hill and the adjoining portions of Matthews and east Charlotte that use the NC 51 and NC 218 corridors.

Source: U.S. Census Bureau, QuickFacts, Vintage 2025 estimates and ACS 2020 to 2024.

The trade area combines population growth of 11.4 percent in five years, a median household income of $100,860, an 83.2 percent ownership rate and a 28.6-minute average commute. A broker survey of a nearby parcel counts 13,904 existing, active and future housing units within three miles of Blair Road. These are the characteristics of a membership trade area: owner households with long commutes and the income to carry a recurring monthly plan.

MMCG identified six operating car washes on the corridors serving the subject. Membership prices are taken from operator websites where the operator publishes them; directory sources confirm existence and address only.

Competitor Number 1 Sam's Xpress Car Wash, Lawyers Road This express exterior tunnel is located at 9248 Lawyers Road, Mint Hill, NC. The operator publishes club plans of $30, $35 and $40 per month and single washes of $12, $17, $20 and $25 for its University-area location; Mint Hill pricing is not published separately. Directory listings show operating hours of 7:30 a.m. to 9:00 p.m.

Competitor Number 2 Sam's Xpress Car Wash, Albemarle Road This express exterior tunnel is located at 13116 Albemarle Road, Mint Hill, NC. It operates under the same club plan structure as Competitor Number 1.

Competitor Number 3 Autobell Car Wash, Idlewild Road This flex and full-service wash is located at 15020 Idlewild Road, Matthews area, NC. Autobell publishes unlimited plans of $24.99 (ride-through), $34.99 (exterior), $59.99 (full service) and $77.99 (super), with prices varying by location.

Competitor Number 4 Autobell Car Wash, Old Monroe Road This flex and full-service wash is located at 4416 Old Monroe Road, Indian Trail, NC. It operates under the Autobell plan structure shown for Competitor Number 3.

Competitor Number 5 Zips Car Wash, Independence Boulevard This express exterior tunnel is located at 9331 E Independence Boulevard, Matthews area, NC. Plan pricing was not published for the location at the study date.

Competitor Number 6 Zips Car Wash, Albemarle Road This express exterior tunnel is located at 5740 Albemarle Road, Charlotte, NC. Plan pricing was not published for the location at the study date.

Directory sources also list a Galleria Express Car Wash and a Blue Wave Express location in the Mint Hill search area; Blue Wave now operates within the Clearwater Express platform following that company's November 2025 acquisition of 53 BlueWave sites. Neither address was verified. No car wash under construction or permitted within the trade area was identified in public records.

The subject's plan ladder of $24.99, $29.99, $34.99 and $39.99 per month matches Autobell's entry plan at the bottom and Sam's Xpress's top plan at the top. The blended revenue per member is modeled at $29.25 in Year 1, rising 2.5 percent per year to $32.29 in Year 5; the largest U.S. operator reported express revenue per member of $29.56 per month in 2025. Retail single washes are modeled at an average ticket of $15.00 in Year 1, rising 3 percent per year, against published single-wash prices of $12 to $25 at the nearest express competitor.

North Carolina taxes car washing as a repair, maintenance and installation service, but exempts a limited-service vehicle wash in which employees only take payment, guide the vehicle onto the conveyor, apply a low-pressure pre-spray or place protective tape. The Project's menu is limited to those activities, so wash and membership receipts are modeled without sales tax. Chemicals and supplies purchased by the wash remain taxable at the Mecklenburg County combined rate of 8.25 percent, effective July 1, 2026.

The largest U.S. operator reports that new locations reach average unit volumes after approximately three full years of operation, and the model stabilizes in Year 3. Industry data for early 2026 shows monthly churn of 7.3 to 7.9 percent; the model uses 7.5 percent. Holding the Year 3 base of 2,800 members against 7.5 percent monthly churn requires 210 new members per month, which equals 9.0 percent of Year 3 retail visits, inside the 9.8 percent conversion rate industry data reports for sites with 2,000 to 4,000 members. Retail volume declines each year as retail customers convert, consistent with the 2026 industry pattern of member revenue growing near 10 percent while retail revenue falls near 4 percent.

Members are modeled at 2.5 washes per month. A 100-foot conveyor processes 60 to 100 or more cars per hour, so peak-day volume at Year 5 is within the tunnel's capacity without queuing onto the public right-of-way.

Location: Blair Road (NC 51) and Fairview Road (NC 218), Mint Hill, NC 28227 Size in SF (Gross): 3,800

Source: Marshall & Swift CoreLogic, MMCG

The land is priced at the current asking price. The utility line carries the fiscal 2027 Charlotte Water system development fees for a 2-inch meter plus the connection allowance. The equipment contingency carries a tariff allowance because Section 232 duties on imported steel and aluminum have stood at 50 percent since June 4, 2025 and the steel mill products producer price index rose 17 percent in 2025. The financial reserve is sized to cover construction-period interest and the Year 1 debt service shortfall of $256,054 shown in the pro forma.

Loan Assumptions

Car washes are on SBA's list of special purpose properties. Under 13 CFR 120.910, the minimum borrower contribution for a limited or single purpose building is 15 percent, rising to 20 percent when the business has operated for two years or less. The borrower is a new business, and the structure carries the 20 percent contribution.

SBA's job opportunity standard, effective for loans approved on or after October 1, 2025, is one job per $95,000 of debenture. The Project's 7.5 FTE support $712,500 of debenture against a debenture of $1,533,364, which would require 16.1 jobs. The Project therefore qualifies through a community development goal under 13 CFR 120.862, which allows a project that falls short of the job ratio to qualify where the CDC's portfolio continues to meet the job average. The goal documented here is improving, diversifying and stabilizing the local economy through a new commercial use on a vacant outparcel of an existing center.

SBA's environmental policy treats car wash only facilities as an exception within the automotive repair and maintenance category, permitting a Transaction Screen as the starting point. No fuel sales are proposed, and the Transaction Screen is carried in the land cost line. A finding of prior fuel or dry cleaning use on the parcel or an adjoining site would escalate the review to a Phase I.

Variable cost per car comprises chemicals at $0.90, water and sewer at $0.57, electricity at $0.48 and maintenance at $0.55, escalating 3 percent per year. Labor comprises a general manager at $62,000, an assistant manager at $42,000 and 5.5 FTE attendants at $15.50 per hour, with a 15 percent burden, escalating 3.5 percent per year; the most recent published Charlotte-area mean wage for cleaners of vehicles and equipment was $14.12 per hour (May 2023), and the national median reached $17.23 in May 2025. Property tax is an MMCG estimate, because fiscal 2027 Mecklenburg County and Mint Hill rates were not confirmed at the study date.

The Year 1 shortfall of $256,054 is funded from the financial reserve. The Project covers its debt from Year 2, and stabilized EBITDA margins of 39.6 to 41.1 percent fall within the 35 to 50 percent four-wall range reported for mature express tunnels. Year 3 revenue of $1,478,132 sits below the $1.57 million median gross sales reported for the 2025 franchise disclosure of the largest express franchise system (aggregator readings of the same disclosure run as high as $1.87 million), which places the forecast inside the observed distribution rather than at its top.

At Year 3 pricing, revenue per car is $13.20 and contribution after variable cost and card processing is $10.16 per car against fixed operating costs of $553,478.

Year 3 volume exceeds the 1.25x coverage threshold by 36 cars per day, a margin of 13 percent.

The Project holds coverage above 1.0x in every single-factor case and above 1.25x in four of five. A new competitor opening within 24 months is the binding risk, reducing Year 3 coverage to 1.14x. The combined case of elevated churn and a new competitor reduces coverage to 0.83x; that case requires both a sustained churn rate above the industry's reported 2026 range and a new tunnel on the same corridor, and it defines the downside a lender is accepting.

The determination of feasible is subject to the following conditions precedent:

The following items could not be verified from a primary source at the study date and are disclosed: the parcel's zoning district and the text of Mint Hill UDO Section 7.1.11; NCDOT station identifiers and counts; whether Charlotte Water applies the high strength charge to car washes and its pretreatment and interceptor requirements; Stage 3 drought treatment of commercial car washes; Mecklenburg County and Mint Hill post-construction stormwater thresholds and fees; fiscal 2027 property tax rates; three-mile and five-mile ring demographics and vehicles per household; Mint Hill-specific membership pricing for Sam's Xpress and Zips; the addresses of Galleria Express and Blue Wave Express; and May 2025 Charlotte-area wages for cleaners of vehicles and equipment.

This model study applies the methodology described on MMCG's car wash feasibility study and SBA car wash feasibility study pages. MMCG prepares car wash feasibility studies for SBA 504, SBA 7(a), USDA B&I and conventional lenders nationwide, with engagements from $4,900 and delivery in 9 to 16 business days.