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Hawaii HVAC & Metal Fabrication w/Real Estate

Hawaii HVAC business for sale

EXECUTIVE SUMMARY

We are presenting an extraordinary opportunity to own a successful HVAC and sheet metal fabrication business, inclusive of its real estate (office, fabrication shop and warehouse), in the heart of Hawaii’s paradise.  This well-established and highly reputable HVAC company is now available for acquisition due to the pending retirement of the owner, presenting buyers with a golden opportunity to build their legacy in the Aloha State. 

This company services commercial, governmental, and residential customers with focuses on: HVAC sales, service and installation, duct fabrication, ductless A/C services, heater repair and installation, A/C and duct repair, architectural sheet metal fabrication and installation.  They are non-unionized and do both prevailing and non-prevailing wage jobs.

The fundamental drivers for their work include Hawaii’s general economy and population growth, contractor work (primary commercial, residential and government), and (indirectly) the health of the Hawaii  visitor economy, which is one of the largest individual segments of the Hawaii economy.

 

In 2023 their sales were $2.98 million and generated $446,697 of Seller’s Discretionary Earnings (“SDE”) after adjusting for market-based normalized lease rent.   

 

The building used by the Business is owned by an affiliate of the Business owner.  It has 9,100 square feet of interior space, on ½ acre of land in a centrally located industrial park. By owning this real estate, the Business owner saves $194,400 per year in third-party lease rent and the total 2023 cash flow of $641,097 is enough to fund the business and real estate SBA loan.

 

Asking Price

          Real Estate (fee simple)       $3.5 million

          Business                           $1.3 million

          Total                                $4.8 million

 

 

Buyer SBA Loan

An SBA 7A lender has pre-qualified the business and the real estate so a qualified buyer can purchase both the business and its real estate in one package deal.  This lender is offering to provide a $4.063 million loan amount (buyer down payment of $737,000), amortized over a 10-year term, with estimated monthly payments (at current interest rates) of $38,362.

 

INVESTMENT HIGHLIGHTS

  • This business is in a growing and profitable industry with modest competition.

  • They have been in business since 1997, have become a well-known and a preferred supplier in their market, have consistently high customer reviews, and have an excellent and growing market share.

  • Excellent and growing revenues, profits, and cash flow:

  • Excellent growing owner’s profits

  • The Company’s real estate containing the headquarters, storage facility, and fabrication shop is included in this offering - so there will be no lease cost and no increases in future lease costs.

  • Strong, long tenured, non-union 10-person operating team (excluding the owner)

  • Current (Jan. 2024) contracted backlog of 23 projects worth $2.2 million of revenue.

  • They get many referrals from past customers and mechanical engineers.

 

TRANSACTION OBJECTIVE

The owner wants to sell both the business and real estate together due to his pending retirement.

 

 

COMPANY

Listing ID: HI HVAC

Location: Hawaii (Island Confidential)

Type of Entity:  LLC

Years Established: 25+

Industry or Business Category: Commercial and residential HVAC and sheet metal fabrication

 

FINANCIAL SUMMARY

  2023 Source: QuickBooks

Revenue: $2,984,629

SDE: $446,697

Total Cash Available for Note Payment (includes no rent payment): $641,097.

 

OFFERING SUMMARY

  • Asking Price:$4,800,000 (business: $1.3 million plus real estate: $3.5 million)

  • Inventory included in the Price: $90,000

  • Tangible Assets included (F, F & E): $422,000, all needed operating equipment, plus 7 vehicles & 1 trailer.

  • Training: 2 weeks; 30 hrs./wk.

  • Sale Reason:Retirement

LOCATION DETAILS

  • Status: Real estate owned by an affiliate of the business owner is included in the offering.

  • Building size: 9,100 Sq. Ft.

  • Fee simple

  • ½ acre of land in new industrial park

  • Current Annual Real Estate Operating Expenses including Real Estate Taxes: $25,900, included in the business expenses.

CUSTOMERS:

General Contractors, commercial businesses, and residential homeowners.

 

EMPLOYEES:

9 non-union (excluding owner)

 

COMPETITION & MARKET CONDITIONS

  • Modest direct competition

  • The Hawaii market continues to do well as the commercial and residential construction market is healthy and growing.

EXPANSION OPPORTUNITIES

  • The first growth opportunity for a buyer is to focus more on sales and marketing activities since they do virtually no marketing.

  • Expanding their work in commercial and residential AC service and repair to a broader array of customers.

  • Market on other Hawaii islands

TRADING DAYS/HOURS

  • Monday to Friday from 7:00 am to 4:00 pm.

 

LICENSING REQUIREMENTS

State of Hawaii contractor’s C-44, Sheet Metal & C-52, HVAC licenses, and a licensed responsible managing employee (“RME”).  The Company owner is currently the Company’s RME and offers to become the Buyer company’s RME for a transitional period after Closing.

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