New Deals: An absentee-run property management company renting to military families, casino software company, and 3 other finds...

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NEW DEALS

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📍 Location: Texas
💰 Asking Price: $2,900,000
💼 EBITDA: $691,703
📊 Revenue: $2,545,888
📅 Established: 2010

💭 My 2 Cents: In most rental markets a property manager's income follows the local job market. Around a military installation it follows a staffing plan instead. Two-thirds of service members rent from the civilian market rather than live on base, a housing allowance covers the rent, and families transfer every two or three years, so the next tenant is usually arriving before the current one leaves. This company manages roughly 550 single-family homes across two markets in West Texas and New Mexico, most rented to military families stationed nearby. Money arrives from management fees, in-house maintenance, lease and renewal fees, and a resident benefits package, and 13 people run all of it with an owner who does not work in the business. That said, I'd want to know how the door count splits between military and civilian households, since only the first gets refilled by somebody else's transfer orders. The maintenance line is what I'd dig into hardest, what it billed last year against what the crew costs, because a manager who sends a repair to a plumber earns a coordination fee while one who sends its own technician also keeps the labor markup. Then I'd ask how many landlords own those 550 houses, since one investor holding 60 takes 60 doors with him when he sells. The ceiling on a business like this is not tenants but landlords, since every new door needs somebody who already owns a house near a base and does not want to manage it, so a buyer's growth conversation is with investors rather than renters.

📍 Location: Wisconsin
💰 Asking Price: $2,100,000
💼 EBITDA: $594,698
📊 Revenue: $3,228,251
📅 Established: 2015

💭 My 2 Cents: The best client a warehouse can have is one whose product gets used up. A case of food leaves the building because somebody ate what was in it, and the brand ships a replacement the following month rather than waiting for a buyer to turn up. Retail reorders too, though more slowly. This company handles warehousing and order fulfillment out of two buildings for food, retail and industrial clients, and a tenured team runs both with the owner out of them. It holds an SQF certification with a near-perfect audit score, which is not a rare credential (more than 14,000 sites hold one) but is scored every year, and a building that slips below 80 points gets audited twice as often. That said, I'd want to know which brands are on the racks and how big each one is, since a regional sauce maker and a national cereal brand are different businesses to lean on. The reorder pattern is the number I'd chase hardest, how often each brand replenishes and whether its volume grew last year. Then I'd ask how many shifts the buildings run and how many pallet positions are full. A competitor can lease a building and pass the same audit, but brands tend to stay with a warehouse for years, since a delivery that slips during a changeover becomes their problem with their own retailers rather than the warehouse's.

📍 Location: Southern California
💰 Asking Price: $6,250,000
💼 EBITDA: $1,081,351
📊 Revenue: $2,223,657
📅 Established: 2000

💭 My 2 Cents: A casino runs its restaurants and bars on one system and its players club on another, and a comped dinner has to cross between the two on a Friday night without anybody noticing. Oracle sells the platform. The crossing is what somebody else gets paid for. This Southern California company has spent 26 years building software and connections around that platform for casinos, hotels and resorts. About 60% of its revenue recurs, more than 96% of it renews every single year, and no client accounts for more than a tenth of the total. A team of seven runs it with the founder largely out of the day to day, and Oracle's own sales organization sends referrals in. The founder is retiring and has offered six months of transition. That said, I'd want revenue split between recurring support and one-off integration projects, since only the first survives a year when nobody is buying anything new. I'd also want the Oracle relationship on paper, because a validated integration gets listed where Oracle's salespeople can see it while a one-off arrangement does not. Then I'd want to know how many people there can actually maintain the code. Every property Oracle signs onto that platform eventually needs somebody to connect it to everything else in the building, and a buyer here inherits a pipeline that widens every time a company far larger closes a sale.

📍 Location: Florida
💰 Asking Price: $1,700,000
💼 EBITDA: $814,000
📊 Revenue: $3,900,000
📅 Established: 2017

💭 My 2 Cents: While pool installation business rises and falls with the economy, demand for pool cleaning and maintenance is largely non-discretionary. A pool left alone for a month usually costs more to bring back than it would have cost to keep clean, so the weekly visit tends to survive a tight year. This company runs cleaning, chemical balancing, maintenance and repair for residential and commercial customers on recurring monthly billing, with seven full-time staff and four part-timers, and there is no yard or shop because the whole operation works out of wrapped vans. That said, I'd want the revenue split across recurring service billing, repair labor and parts resold, since those three carry very different margins and only one of them renews on its own. The account list is the document I'd read next, set beside a map of the route, since what one technician covers in a day is decided by the driving between stops rather than by the number of pools. Then I'd ask who holds the state contractor license the repair work is done under, because in Florida that license belongs to a person rather than to a company. A technician standing at the same pool every week sees the pump start to fail before the homeowner does, so a buyer here is acquiring a repair pipeline that costs nothing to prospect.

📍 Location: California
💰 Asking Price: $1,990,000
💼 EBITDA: $400,000
📊 Revenue: $2,500,000
📅 Established: 2000

💭 My 2 Cents: Buried garbage stops getting oxygen within about a year and starts giving off gas that is roughly half methane, so a landfill drills wells into the waste, caps each with a wellhead, and pipes it to a flare or an engine that makes electricity. Keeping it legal is continuous work, since the operator checks wellhead pressure monthly and walks the surface quarterly with a meter, and a reading above 500 parts per million has to be corrected, sometimes with another well. These systems run about one well per acre, so an active landfill needs another wellhead every time it fills another acre. This Northern California company builds that hardware, from wellheads and expansion fittings to metering manifolds, and has recently extended into dairy biogas. Nine people work a leased shop, the owner puts in 30 hours a week, and the $350,000 of equipment is included. That said, I'd want to know how much of last year's revenue replaced worn parts rather than fitting out new acres, since only one of those arrives whether or not a landfill is still growing. Whether the order comes from the landfill or from the engineering firm that designed the system is what I'd chase next, because a part named in a drawing gets bought by everyone who builds from it, while a part the landfill picks is bid against other quotes. Then I'd ask which designs are protected and which any competent shop could copy from a photo. A landfill cannot relocate, cannot close early, and cannot stop monitoring what it buried, so a buyer here is acquiring a customer list that does not churn even though every order has to be won.