Pair Of Large Cap Daycares In Houston Metro

Business Overview:

This listing is for two locations of large capacity daycares - one owned real estate, one leased - for the amount of $1,290,000, PLUS real estate of owned location for an additional $3,700,000, for a total project of $4,990,000.

The business portion is not SBA lendable at this time. Buyer will need a minimum of $1.8 million, of cash/liquidity available down, plus the ability to finance the real estate through alternative bank / investor lending.

Available for immediate consideration is a pair of top rated, leading early learning schools located in the Houston Metro area. Originally established in 2009, these reputable daycares have been a staple in the community offering local school district supported learning curriculum, including STEAM based and hands on learning created to prepare students to excel in kindergarten and beyond.

Acquired by existing ownership in 2019, these centers are running primarily absentee with limited ownership interference. Owners are investors and operate other businesses outside Houston and the state. Both locations are overseen by a regional manager, and each has a Director and Assistant Director on site that manages the day to day. While this has proven to be very successful, owners feel that more hands-on participation will enable the schools to maximize capacity, which is a combined number of 385 enrolled students. Current enrollment is approximately 230-250.

Despite acquiring prior to COVID and the challenges that resulted, combined revenue in 2023 was right at $2.9M and is on track to be consistent in 2024. Summer enrollment was a little light for one location due to a change in leadership, but is rebounding. Combined average enrollment is approx. 70%, and with a little more owner involvement revenues could be maximized accordingly, with the majority resulting in an increased bottom line. Considerable grant monies were received during COVID period, and even with removing those, SDE ranges from 14-21% and EBITDA 11-16%.

While 2024 was forecasted to be on par with 2023 or better, in the May timeframe there was a turnover of key personnel in the leased location which caused some additional expense in rehiring, as well as reduction of enrolled students. While that location is on the rebound, it resulted in a consolidated reduction of earnings in total. The owned location is still on target to meet expectations, but the second location has pulled down the performance overall. As a result, the business will need to be acquire for cash to most buyers. Experience, multi-location daycare providers can probably accomplish a loan for the entire transaction, which includes real estate. At this time, only buyers interested in purchasing both daycare centers AND the real estate will be considered. Real estate is listed for an additional $3,700,000, in addition to the $1,290,000 business price, for a combined purchase of about $4.990M.

These schools are in excellent, turnkey condition, and require no capex or any material improvements.

TRANSWORLD BUSINESS ADVISORS OF HOUSTON. LISTING REF # 76931-611918

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Property Features and Assets:

Real Estate Asking Price: $3,700,000.00

Monthly Rent: $27,200.00
Square Units (Foot, Meter): 11,000
Lease Expiration Date: April 29, 2034, 10:00:00 PM
Terms Options: Additional terms available

Facilities:One facility owned, available for $3.7m. Second location, free standing as well. Both had a complete refresh in 2021-2022 and no capex improvements are required.

FF&E Overview: Modernized and refreshed in 2021/22

FF&E General Condition: Excellent

Market Competition and Expansion:

Expansion: 

o Optimize go to market strategy
o Make GoogleAds and other digital marketing campaigns more efficient
o Works with local employers to offer daycare services to the employees as a preferred location
o Owner operator involvement to maximize enrollment

Reason for Selling:

Additional Details:

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