SBA 7(a) Car Wash Feasibility Study in New Jersey

Car washes in New Jersey: costly sites, independent owners

New Jersey car washes were approved for 96 loans with $97.5 million in gross dollars, counting FY2017 through FY2026. That is a large dollar total for the count, and the median loan of $550,000 supports it, although the figure is only 0.70x the national level for the class. The central band is wide, running from $47,500 to $1.7 million, so the cell holds both small equipment loans and costly real-estate projects. New Jersey is 7 among states, and car washes hold 14 of 39 positions inside the state. Franchising does not appear: the share is 0.00%.

Holders and places

TD Bank, National Association appears as holder of 20 loans worth $2.7 million, a small average. Fulton Bank, National Association is credited with 10 loans worth $14.5 million, and New Millennium Bank with 8 worth $11.3 million. Provident Bank accounts for 6 loans and $9.8 million, as does Peapack Private Bank and Trust for 6 loans and $5.8 million. These are SBA holder entries and nothing in them describes anyone's practice. Passaic County leads with 11 loans, Ocean has 10 and Union 9, and Bergen, Camden, Middlesex and Monmouth each have 8. Approvals jumped to 17 loans and $25.1 million in FY2021, slid to 6 loans and $3.5 million in FY2024, and recovered to 13 loans and $15.3 million in FY2025.

Outcomes

Cancellation hit 11.0% or more of the approvals dated through FY2024, and 12.3% with undisbursed loans included. Among the 44 early funded loans, 4.5% have been charged off to date, and an identical 4.5% occurred within five years. Those are floors, because the loans still open could add to them.

A note on what the code covers

New Jersey's record cannot distinguish car washes from truck washes or mobile washing, since a single industry code covers all of them. A project that depends on one of those formats should say so in its own study.

A New Jersey car wash study has to establish whether the format is express tunnel, in-bay automatic, self-serve or full service, because capex and labour differ greatly. Traffic counts on the road, the stacking space on the lot, local zoning and water and sewer rules for runoff are as important as customer demand. Revenue should be built from cars per day, average ticket and the share of subscription members, and the study should test a rainy-season downturn. Large loans in this cell finance land and buildings as well as equipment, so the appraisal will need a market value of the real estate that does not depend on the car wash business alone. Competing tunnels within a short drive can shift volumes quickly.