So I am looking at the possibility of purchasing a 32 unit property. (Still very early in the process.) One of the value add ideas I am tossing around in my head is Vending Machine's and or an ATM being placed in the property. Does anyone have any recommendations for a company they have used for vending machines? Did you approach a bank directly for the ATM rental or a 3rd party company? What experiences have you had with them? What kind of return did you experience with how many units?
Should the deal work out and I actually purchase the property I also plan on rehabbing both existing laundry rooms and replacing the old outdated machines. (From what I understand the current machines breakdown often.) What do you recommend, coin operated or card? Other suggestion? I think owning the machines is probably better but what are your thoughts on leasing and profit sharing? If you have done both, (Owned machines and leased machines/ profit share ) which option did you prefer?
Has anyone ever put a pinball machine or something of the like in a laundry room? Thoughts?
Hope that’s not how you plan to move the needle. Forget the vending machines, 32 units are peanuts in terms of scale for that type of idea.
Go to Lowes or Hd website, you can buy coin op. Washer and dryers now of days for cheap, run the price to the sky. We are $7 to wash and dry, or you can travel a bunch of blocks and pay $1.25 a load, people opt to pay more vs walk or drive. It’s a win win, lower usage, good returns, and we check that box for washing machines in the buildings.
Your money is going to be made in the lease agreement, PM style. Nothing like picking up late fees, check processing fees, pet fees, lockout service fees.
No, as I said it is only one of the ideas. Main increase will come from rents. Current rents at the property are under market between $50-$100 Per unit. Property will need a little work before I just slam some rent increases on people but bones are good, I plan on repositioning the property. It is a C property in a B area.
Thanks for the reply. That was one concern about the vending machines I had but have never done it before and I am not familiar with the way it works. Do you lease the machines and buy the product to stock the machines?
Wow $7 to wash & dry? You found that charging the higher amount, most people still used the machines? You said "Lower usage" so I assume a drop of in people using it. How much increase of a return did you see by doing the increase even though you saw a drop off in use? (Which I guess could save money on repairs if you own the units.) Did you notice any drop off in tenant relations/ Tenant retention?
ATM? You got security camera, alarm? What happens some tenant or creep pulls the ATM and apts building with their truck together. I doubt any insurance will insure the bldg. or endorse idea. You need business license, city license having that much traffic. Is that a public business like 711, hotel? If you have the laundry room I see nothing wrong getting a game machine. Most are so cramped so you put less machines.
Vending machines are done by 3rd party, they cut you a small profit out of it. You do nothing but get a check. You would have somewhere around 64 people that would see or be able to access this machine. I would assume they would pass by at about a rate of 1,920 times in 30 days.. if 1% bought something, that’s 19 buys. If you got 20c for each buy on average, your making $3.84 per month.... Zzz
We installed washing and drying machines to check off that we had them in the building, we jacked the price to insure no one would abuse them. At first no one used them for months, then slowly 1-2 people did one load here or there.. we are now averaging 2.5 loads per month per unit in income. We follow this process for all MFU we own. Good luck.
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