Want To Buy a Car Dealership?

At least one industry is making retail look, well, sort of good. Between GM and Chrysler we’re going to see the shuttering of about 1,800 car dealerships nationwide pretty soon.

By any account, that’s a lot of real estate hitting the market. Are there any opportunities for retail here?

We’ve heard of more than a few situations where it’s happened the other way around, and car dealerships have gone into vacant retail stores. It wouldn’t surprise us if some enterprising restaurant concepts jumped on these opportunities…we know the places have parking!

Or is our industry experiencing enough problems with its own vacancies to even worry about possible new opportunities such as these?


9 Responses to “Want To Buy a Car Dealership?”

  1. 1 Dealmaker May 15, 2009 at 7:17 am

    These are definately another factor to consider. Typically high traffic and good visibility locations at bargain basement prices, with ample parking and large freespan buildings. I’ve already run into them as competiton for large space users. They will and do appeal more to a user who can arrange a NNN sale lease back. The only obstacle for a retailer is…aquiring the capital to convert to their prototypical concept. Historically it’s shopping center owner / developer capital that has made most retail exansion at this level possible.

  2. 2 HEG May 15, 2009 at 8:56 am

    Vacant car dealerships could be used to house the unemployedthat will result from these ridiculous closings. By a bankruptcy court. Why would you eliminate an established sales and service facility? Why sell to Fiat? Makes no sense!

  3. 3 Broker May 15, 2009 at 9:37 am

    Half of these dealerships sell 100 cars per year or less. You will see a lot of 2-4 acre sites become available in small towns. It will be interesting to see how all of this shakes out – I am not sure Congress will be pleased to see the 150,000 or so people employed by these dealerships hit the unemployment lines and the owners who were probably a good source of campaign contributions lose their investments.

  4. 4 kin powell May 15, 2009 at 11:09 am

    Chrysler announced 800 & GM announced 3600 closings that equalls 4400 in my math!

    • 5 iritter May 15, 2009 at 11:12 am

      That’s not what the Journal article I linked to says, KP. Reply with a link that has 3,600, and I’ll post it.

  5. 6 James May 15, 2009 at 12:01 pm

    This will represent a big loss of sale tax revenue for the cities were these closures are located. There may be an opportunity to go in and negotiate an incentive package, ( up zoning, property tax relief, sales tax reduction, city paid infrastructure, etc)if you can really turn some of this property around and make it productive. Frequently dealerships are located next to each other so there may be an assemblage play available too. Time to build up land inventory and get positioned for the next wave.

  6. 7 Miguel de Arcos May 15, 2009 at 3:34 pm

    Our office has just listed our 3rd “now vacant” name brand car dealership in Central Florida. Finding a new replacement use is the key. The problem for the owner of the real estate is that the bank owned ones are being fire sale’d to beat this new wave of inventory. It will be hard to unload the property if it is no longer cash flowing. We have one low offer from another used car dealer, and 2 retail redevelopment plays, but there is no demand for new retail development right now.

    Miguel de Arcos
    Sperry Van Ness

  7. 8 kin powell May 15, 2009 at 3:46 pm

    You’re right i miss read the #’s Gm is reducing by 2400 dealers & the first 1k are done the rest will be handled by the BK court. Unfortunately,that’s insufficient in my view as the new normal in US will be 12-13m/yr. the market needs only 10,000 net dealers selling 100 cars/day. Half the car dealears need to find something else to do!

  8. 9 Glenf May 18, 2009 at 9:53 am

    I had the ‘opportunity’ to attend a funeral ‘reception’ for my brother-in-law in Klamath Falls, OR in a building that had previously (I don’t know how long ago) been a Ford store in the middle of downtown K-Falls. Big hall, lots of parking, so it worked well. Now known as the Egyptian Center.

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