The net-leased car wash sector has entered this year with a noticeable contraction in available properties, even as pricing and yield metrics held steady, according to the latest market overview from B+E.
In January, the number of on-market NNN car washes dropped to 200, down from 240 in December, marking the second consecutive month of declining inventory and a 31% drop from the November peak of 289 listings. For investors pursuing 1031 exchanges or private capital acquisitions, the shrinking pool of available properties has increased competition for stabilized assets and highlighted the importance of operator quality and geographic positioning, according to B+E.
Average cap rates remained largely unchanged, settling at 6.24% in January. This consistency over the past six months underscores both ongoing demand for well-operated car washes and predictable underwriting expectations, said B+E. Premium operators continue to trade below the market average, reflecting strong tenant performance, while select smaller or secondary operators price above 7%. The tight spread illustrates how lease duration and tenant creditworthiness remain key determinants of value.
Operator scale continues to shape market perception and inventory distribution. Whistle Express Car Wash led the market with 37 listings, followed by BlueWave Express with 30, Clearwater Express with 16 and Caliber Car Wash with 14.
Geographic concentration remains pronounced in Sunbelt states, with Texas alone accounting for roughly one-third of the total inventory at 66 listings, followed by Florida (23), Georgia (18), Arkansas (13) and California (12). Cap rates vary regionally, ranging from mid-5% in select western markets to mid-6% or higher in secondary areas, reflecting local market dynamics and operator strength.
Lease terms continue to support the sector's appeal for income-focused investors. January's average remaining lease term was 18.5 years, offering long-duration, passive income that appeals to 1031 exchange buyers and defensive portfolio strategies. Investors are likely to see continued competition for well-located, scale operators, with potential cap rate compression for premium assets if inventory remains tight, according to B+E.
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