Magic Hands Car Wash owners clean up in huge Newtown sale
The Magic Hands Car Wash site at 250 Latrobe Terrace, Newtown, has sold for $2,225,000.
Who would have thought washing cars would pay so well?
Vendors who bought a vacant block of land on the corner of Latrobe Terrace and Aberdeen Street, Newtown for a little over $800,000 in 2016 have just cashed it in for $2.225m at auction.
That’s an increase in value of 171 per cent after four years.
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The sellers built the Magic Hands Car Wash outlet on the 1050sq m site in 2018.
CBRE selling agent Scott Hawthorne said the sellers invested around $1m in developing the site.
The Magic Hands Car Wash site at 250 Latrobe Terrace, Newtown, has sold for $2,225,000.
The property comes with a secure lease to Magic Hands Car Wash, which will generate a net annual income of more than $125,000 for the new owners, who are Melbourne investors.
The lease, which has fixed 2.5 per cent annual increases from 2022, is secure to 2030, with two five-year options available.
The substantial property improvements include the specialised hand car wash facility coupled with an operational café and diner for customer convenience and additional income.
The Magic Hands Car Wash site at 250 Latrobe Terrace, Newtown, has sold for $2,225,000.
Staff were busy washing cars last week as the auction went ahead in Melbourne.
Auctioneer Paul Tzamalis the property had attracted a number of potential buyers keen to secure the land-rich investment.
“Some that know the covenant that is the Magic Hands Car Wash entity, others that have been drawn to the return that is very hard to find in the current market,” he said.
“They’re land rich and well positioned and the covenant has hand-picked the positions for each of their businesses.
The Magic Hands Car Wash site at 250 Latrobe Terrace, Newtown, has sold for $2,225,000.
“They’re high-traffic, high exposure locations. Like any convenience service, that is exactly why they’re easy, they offer great convenience like service stations, child care centres.”
Mr Tzamalis said the CBD fringe site was also a strong draw for buyers.
“We are seeing centres like Geelong, which is already on an upward trajectory, grow even further,” he said.
Mr Tzamalis said the owners of the business were doing extremely well.
Paul Tzamalis called the in-room auction for 250 Latrobe Terrace, Newtown, for CBRE.
He said the industry had grown as more people had the time, nor the space to hand wash their cars at home.
“$74 per cent is the average spend. Looking at their trends are — up 43 per cent year on year in October, up 53 per cent in November, they’re performing extremely well.”
The site operated as a Shell service station until the early 1990s.
CoreLogic records show Shell sold it for $165,000 in 1994.
Since then, three investors turned dollars through selling carparking spaces on the city fringe site, while the land value accumulated over the next two decades.
