Denver Metro Mostly High End Used Car Dealership 

Great Location, Great Website, 4.8 Stars Google, High End, High Volume, with Happy Well-Trained Employees 

The trailing 12-month revenues to April 30th was 18,272,221 with normally adjusted earnings of 1,087,217.  2024 revenues were 16M with earnings 387K because of the temporary impact from higher interest rates, tighter than normal credit, a drop in overall car purchases nationwide, and a drop in the current value of most vehicles which all have mostly reversed themselves in 2025.  2023 was similar with earnings of 386K; BUT, 2022 had earnings of 1M and 2021 had earnings of 1.2M, and 2025 looks to be a return to how things were in 2021 and 2022.  The Seller has convinced me that this is a very professional used car lot with some of the best employees in the industry.  It is in a high traffic location with great street appeal.  40% of their customers are repeat customers or referrals from them. 

Keep in mind the timing of this listing.  Rarely are there 3 down years in a row in the used car industry and we just finished 2 ½ down years which means this purchase should be great timing as evidenced from how good the earnings have been in March and April 2025.  Adding to this is the potential impact of tariffs which includes less imports which is making new cars more expensive and driving up the demand and therefore the price and profit of selling used cars which are not subject to the tariffs since they are already here in the US.

Various Valuation Methods:  1) Taking the last 5 periods average earnings which had 3 good and 2 bad years.  This is the trailing 12 months, 2024, 2023, 2022, and 2021 which averages 835k per year in earnings which multiplied by the normal used car dealership multiple of 4 times would make the sales price 3.35M plus inventory.  2) Taking the last 3 years average earnings which had 2 bad years and 1 good year averages 645K per year X 4 times multiple =’s 2.58M plus inventory.  3) Taking the last 2 periods average of 762K X 4 =’s 3.05M plus inventory.  Even if you lower the multiple to well below market, the expected sales price would still be well above the 1.95M plus inventory that he is asking.    

Sales Price: The sales price is based on using an average of the trailing 12 months and 2024’s earnings which average 762K times a multiple of only 2.6 times which is 1.95M plus inventory.  The real estate is being offered separately at 2.95M.   This is priced to sell because he needs the money for personal reasons.

Auto dealers usually sell for +/- 4 times the earnings plus inventory because they are typically location driven fun businesses to own but we have priced this at less than 2.6 times the last 2 periods of earnings and less than 1.85 times multiple on the trailing 12 months earnings plus inventory.  The inventory is extra and is currently estimated to be 2.25M which is cost plus their cost to prepare each car for sale. The actual amount of inventory will fluctuate daily as inventory is sold and new inventory arrives and will be adjusted at the closing properly.  It is updated daily in their website.

They sell a wide range of used cars including Audi, BMW, Mercedes-Benz, Cadillac, Jaguar, Land Rover, Lexus, Porsche, Lincoln, along with all types of makes and models.  The business will continue to grow on average over time based on their very high traffic location, quality inventory, experienced salespeople, repeat customers, referrals, and services they provide including accepting trade ins and offering financing choices. 

He listed this business in early 2024 at 2.45M plus inventory but didn’t want to sell the real estate at the time and most buyers of dealerships want to buy the property also since the revenues are mostly location driven.  We took it off the market quickly because the downtrend in the industry wasn’t over yet and he didn’t want to sell the property then.  This company and the industry are back in an uptrend and has higher earnings now than when we listed it at 2.4M plus inventory and we have currently lowered the price to 1.95M plus inventory even though the earnings are much better now.  

Although the owner has been involved in the business since its inception, he has greatly increased the time that he spends with his family, has other business interests, and has a place in Florida that they spend a lot of time at so he is not "the face of the business", and has reduced his hours to 20 hours a week doing mostly training at this point. 

The buyer will also get 100K dollars in current value of equipment, tools, furniture, computers, surveillance system, phone system, etc.

This company has a 4.8 Star Rating on Google, with 1,256 reviews which is excellent especially for a used car dealership which is very valuable considering trust is a big factor in choosing where to buy a car. It is rated A+ by the BBB. They are also a member of the "Colorado Automotive  Dealers Association". They have a great interactive website with all of their inventory posted on the website.  This company has an excellent reputation in the industry.  The new buyer will need to have or get a Colorado dealership license to be able to buy this which is obtained through the Colorado Motor Vehicle Dealer board and can take a month or two.

Summary:  The sales price is only 1.95M plus inventory which is currently estimated to be 2.25M.  The real estate is being offered at an estimated 2.95M because an appraisal will most likely determine the final sales price of the real estate.  He has asked me to screen for only serious buyers who can prove funds, or has secured financing, is successful private equity, or a buyer who already owns one or more dealerships already in Colorado.  He will carry 10% of the dealership and none of the real estate.  Lenders will require experience, a high net worth, and typically more than a 10% down payment.  Some Buyers will prefer to use “floorplan” financing for the inventory and pay for the business portion without financing.  I can’t set any meetings or phone calls with the owner unless you can prove that you are capable of buying this.   Keep in mind that if you plan to floorplan the inventory, you will need to write a 1.95M check for the business because banks require the inventory as collateral which only lasts until each vehicle is sold at which time the new inventory can be floor planned.  Normal banks generally don’t like used car dealerships but there are some banks that specialize in this type of business.   

Location: South Denver Colorado