Why Chris Salerno Invests in Car Washes, Oil Changes and the Real Estate Underneath Them

Chris Salerno (00:00)

Not only do they drive right past, Scott, but they also use and don’t realize it. And going back to our thesis—and you said it extremely well—is we invest in the infrastructure of daily life. So not only do we own the underlying real estate, but we also operate the business. So we’re able to yield higher cash flow because it’s not just a real estate play; it’s business and a real estate play.

Scott Bursey (00:52)

Welcome back to the Real Estate Pros Podcast powered by Investor Fuel. I’m your host, Scott Bursey. Glad you’re with us. And today we’re delighted to be joined by Chris Salerno. Chris is the founder of QC Capital Group, a private equity firm he launched in Charlotte, North Carolina at the start of 2019. He started in multifamily, and his firm has grown into the businesses of everyday life: express car washes, express oil changes, flex industrial space, and a healthcare company. And his rule through it all: own the real estate underneath. It all adds up to one idea: Chris invests in the infrastructure of daily life. Listeners, get ready for some valuable insight on building a firm around the things people use every single day. Chris, welcome to the show.

Chris Salerno (01:47)

Scott, thanks so much for having me. Excited to be on and give my knowledge to help your listeners help themselves in their journey of investing.

Scott Bursey (01:55)

Awesome having you here. And to help our listeners get up to speed, please give us the ninety-second highlight reel, if you will, of how your career ignited and where you’re pouring your fuel now.

Chris Salerno (02:06)

Yeah. No, I appreciate it, and thanks again so much for having me. So I’ve been in the real estate industry since end of 2014, beginning of 2015, so going on over a decade now. And I started out in the residential brokerage industry. I didn’t come from a very wealthy family, so I knew my hard work and my dedication will outperform my competitors.

So early on in my career, I started out in the residential industry. Very quickly, within two years, built a residential brokerage in Charlotte, North Carolina, producing roughly around 40 million in annual sales. From that, I then sold my portion to a larger organization, which I ended up becoming their COO. With that transition, I was able to bring them from 92 million in annual sales to 147 million. Throughout that time period, I owned fix-and-flips, I owned single-family rentals.

Approaching end of 2018, beginning of 2019 is when I founded QC Capital Group. At the time, we were solely focused on institutional-grade multifamily assets, so we were a quote-unquote “real estate firm.” I started divesting my single-families in 2018 and ’19 to then roll that into large-scale multifamily assets. Well, given the state of the market, I saw the cap rate compression. We sold off a majority of our portfolio, still hold a couple assets, and we pivoted into becoming a true private equity company, which we are today.

So Scott, you said earlier, we are in real estate still, which is express car washes, express oil changes, which yield very high tax benefits—and I’ll touch on that later—better than any other residential, multifamily, and/or other traditional real estate. We are in small-bay industrial here in Charlotte and in the Atlanta market. And our healthcare business is a virtual business, so we don’t have real estate in the healthcare business. And then we have some other investments in self-defense and some other organizations, but we are now a true private equity company with investments into physical assets as well.

Scott Bursey (04:04)

From a top team in the Carolinas to buying the businesses everybody drives right past—that’s quite a road.

Chris Salerno (04:12)

Yeah, it’s been fun, and we still have a long journey ahead of us, and the team—it’s exciting to work next to wonderful individuals. So I have to give my hat’s off to a phenomenal team here that really pushes our day-to-day operations.

Scott Bursey (04:26)

What really caught my attention about you, Chris, is where you put your money. Most investors chase the deal of the moment; you buy the businesses people use every day, and you own the ground they sit on. That’s a different way to build. Taking that a step further, you started in multifamily and then you moved into car washes, oil changes, and flex space. What do you see in those everyday businesses that most investors drive right past?

Chris Salerno (04:56)

Yeah, and not only do they drive right past, Scott, but they also use and don’t realize it. And in going back to our thesis—and you said it extremely well—is we invest in the infrastructure of daily life. So not only do we own the underlying real estate, but we also operate the business. So we’re able to yield higher cash flow because it’s not just a real estate play; it’s business and a real estate play.

So when we go to have that potential exit, normally the buyer’s willing to pay a little higher premium—and it goes off of EBITDA on the generation of the business—but they normally pay a little higher premium because we own that underlying real estate. And so that is crucial to us throughout our ownership, is having that underlying real estate.

There are some opportunities that we’ve come across that looked great that did not come with the real estate, and we’ve talked about pursuing those. We did not pursue those directly; however, it’s still on the horizon. We’re not gonna pass up a great investment opportunity for our investors even if we don’t own the real estate. But at the moment, a hundred percent of our real estate is owned by us as investors and as an organization, and we really like to focus on that thesis and be there.

So in good times and bad times, you still need to use this type of service. If you look at, for example, the car care side—express car washes and oil changes—look at the statistics: I believe it’s over 43% of cars on the road have over a thousand-dollar-a-month car payment. People are holding on to their vehicles a lot longer—seven to ten years, where it used to be three to five; now it’s seven to ten. And so you’re going to take care of your vehicle more because you have to hold on to it longer, given higher interest rates. You’re not going to be able to go and flip it into a new vehicle these days.

And if you look at the supply chain, Scott, I remember back in the day, they used to pre-order 2027 models in Q4; now they can’t even get rid of their 2026 inventory because of that chip manufacturing shortage that happened right after COVID delayed it. So people are holding on to their vehicles a lot longer, and we would love to be the organization that services them here in the Southeast.

Scott Bursey (07:37)

How much of the win is in the business and how much is in the real estate under it?

Chris Salerno (07:44)

Yeah, so for tax purposes and depreciation—please keep in mind all of this is estimate and it’s not factual for one particular deal, my disclaimer—is around 15% is allocated from the real estate; the rest is the business. The reason why is because a lot of these businesses have a lot of equipment. Well, what a lot of people don’t realize is that back in the first administration of Trump’s—and I don’t want to get into politics, but that administration passed this law—is that gas stations and car washes are depreciated at a 15-year depreciation schedule because of all of this equipment. Plus, we can take the tax code 179 for all of this equipment and bonus depreciate it in year one.

So, for example, if you’re buying a $6.5 to $7 million car wash, you can depreciate roughly $5 million to $5.4 million of it if you’re taking on debt. And that’s pretty significant because that means you’re only bringing down two and a half to three million bucks. You can do the math right there: it’s about a 1.7 to a 1.8x multiple on your invested dollars that you’re gonna get and receive as tax benefits.

Scott Bursey (08:53)

Thanks for walking us through that. Chris, wondering: with you at the center of it all, where does the work pile up first?

Chris Salerno (09:03)

Yeah, well, it definitely piles up at 5:00 AM—that’s where it piles up first. So I love what I do; I eat, sleep, and breathe it. The way I’ve built the organizations, including the healthcare, flex, and car care, is I have leadership that operates those just like a true private equity company, and those leaderships report to me. I deal with any large, major issues, making sure KPIs are hit. If KPIs are not hit of each of the organizations, there’s always underlying factors, too, and that’s what you have to understand as a leader, is the market can dictate some of these KPIs, so you have to really understand it and dive deep into it.

But again, I have a phenomenal leadership team that runs each independent organization that has experience in each independent organization. And as we grow as a true private equity company with us making strategic investments into other businesses, that’s what we look for: is that key leadership, the management team, how long they’ve been there, what is their experience, do they have the ability to grow? And we bring that operational expertise of coming in, adopting AI to make teams more efficient, and then also growing those businesses.

Scott Bursey (10:09)

Let me ask you this: you watch the Fed and the rate picture as closely as anyone. Where is the open door for a buyer right now?

Chris Salerno (10:21)

Yep. Well, I think Q4 is gonna be a pause; it’s gonna be very slow. Look at the history: every time the Fed raises rates, there’s always a pause. We’re taking a pause on the flex industrial. We see it because buyers want three months ago, four months ago pricing, and numbers don’t make sense. So there’s going to be a lag, and in that lag period, though, there’s going to be still opportunity.

The lovely part—and I was explaining this to someone that didn’t have commercial experience—and I said the lovely part is that with commercial real estate, normally between three to seven years, there is a loan that has to come due. There’s a balloon payment. Even if you have a three-year term with two one-year extensions, or a five-year term or a seven-year term, or even a 10-year term, you can get that—but a lot of banks are not doing that these days because that locks them in. But that term period, those three to seven years, give or take, if you have extensions or not, means something has to trade. And that’s either refinance, that’s either a sale of the property—someone has to trade hands, either with a lender or with someone else.

So there’s always opportunity. It’s just given the current market environment, the opportunity shifted to: if they’re a traditional seller, then they may be a distressed seller now. And so that’s opportunity that you can really take on, and it’s going to come down to surety of close, timeframe of close, all of that. And it also depends on what asset class that you’re in, that will dictate if these market rates and these asset classes are going to cash flow or not.

Scott Bursey (11:56)

Thank you for sharing that with us. Real talk, Chris: rates, jobs, and the cost of money run your world. Which one of those concerns you the most right now?

Chris Salerno (12:47)

My answer to your question is going to be all of them, and the reason why is: how factual is the data we’re getting? Prior to Trump getting in, there was data that was published; supposedly, that data they miscounted by 800,000 jobs—799, I believe the number was. That’s nuts! You miscounted that many jobs; that fluctuates the market. And so I question the data that we’re receiving: how factual is this data when we have current job openings right now, Scott? Within six hours, we’ll have 80 to 150 applicants, depending on the title of the job. That tells me that there’s a lot of competition out there hunting for a position compared to only having two to five applicants.

And so seeing it firsthand, I’m just very skeptical about when we are seeing reports that jobs are increasing substantially. It’s like, okay, well, we are still not feeling it at the grocery store. When a year and a half ago, you go pick out the same exact items at the grocery store and it costs you 300 bucks, now it costs you six, six-fifty—there’s an issue there. And I think that does also stem with oil and gas, higher gas prices. ‘Cause if gas prices are higher, logistics are higher, because the 18-wheeler taking those goods to that grocery store is gonna charge more because they have to pay more gas. Which then at the end of the day, the consumer who’s buying those products has to pay more just to make sure the grocery store makes that same profit that they used to make, just so they can stay in business.

So I think the big thing with me is: can we trust this data that is out? The data that is out shows positive; however, I still do not feel—in my opinion, I want to speak for hopefully majority of the population in the United States—I think they don’t feel that at the grocery store, at the gas pump, when they’re buying regular consumer goods. And that right there can be detrimental for businesses that are not investing in the infrastructure of daily life.

Scott Bursey (14:55)

I guess the big question, Chris, is: how do you position the firm for it?

Chris Salerno (15:01)

The investments in necessities. We invest in necessities: healthcare, oil changes. You need to change your oil in your vehicle to get to and from work, or your engine blows up. No one’s buying—insurance is not gonna cover that; that’s neglect of your engine, the regular maintenance. So investing in the infrastructure of daily life, investing in essentials that we need as humans.

And that’s when we go in to look at investment opportunities and we say, “Hey, is this essential? Does this make the human efficient?” Scott, you come into one of our car washes, we’ll wash your car within three minutes. You come into one of our oil changes, within 15 minutes, Scott, you have your oil done. And guess what? You don’t even have to get out of your car; you can sit in your car. And now we’re putting TVs up where we’ll give you a remote and you can watch a little Netflix series if you want, so you don’t fall asleep.

When it comes to our flex industrial, we’re giving small businesses—who run America—the opportunity to have a warehouse space, an office, and a bathroom all in one where they can conduct business. Our healthcare side, Scott: for $50 a month, your whole family is covered. You’re able to see a doctor within 15 minutes at the comfort of your own home, all by your cell phone.

So that is where our mindset is when we’re making investments. And if it’s investments like the car care side where it comes with the physical real estate, we always say, “Hey, we want to own the underlying real estate,” unless this business is just booming, we say, “Hey, it would be a good opportunity to bring this on; let’s see if we can have an option to buy the real estate down the road or something.” We’ll still evaluate investment opportunities, but at the moment we do own a hundred percent of our real estate. We’re just firm believers of that, but that doesn’t mean we’re not going to look at an opportunity if it does not come with the real estate.

Scott Bursey (16:48)

I wanna go a little deeper on this one, Chris. You host your own show and you teach investors through your network. What’s the first mistake you see investors make when they try to grow?

Chris Salerno (17:01)

When they try to grow, the first mistake investors make is going to be they get their feelings wrapped up in the business—that’s going to be the first mistake—and not being confident. I think, Scott, it’s important that when investors invest into funds—for example, our funds are listed on Charles Schwab’s alternative platform; they’re all third-party audited by Elliott Davis. This is starting from January 1st, 2026 to present and beyond: they’re all third-party audited. That’s something that separates us compared to all your other syndicators out there and most of your fund managers that are raising from retail investors, that their funds are not audited and they’re not listed on Charles Schwab, which is a whole different type of approval process.

I think a big question to ask any main operator if you’re looking to invest is: how are you personally? How’s your wife at home? Or if you have one, how’s your fiancée? How’s your girlfriend? How’s your kids? How are you financially, personally? Because I have seen firsthand operators that are not financially sound make poor decisions of investors’ capital. And what do I mean by that? I mean that they buy deals that they shouldn’t have because they just need to make a buck.

And that is private equity—because they get allocated, for those that are maybe retail that are listening here that may not be a little more institutional: private equity gets allocated from large pension funds, endowments, other PE firms, RIAs. And when they get an allocation, they have a time period that they need to hurry up and deploy it; you don’t want to just sit on half a billion dollars not earning money. And when you meet with those type of investors in the beginning of that other calendar year, they go back and say, “Okay, what have you deployed last year? Out of that 500 million that we’ve allocated you, you only deployed 250 million, so we’re gonna make sure that your next allocation is 300, not 500.” And so a lot of private equity firms will—and this is your institutional side—they’ll just acquire, acquire because they want the unit counts, because they have to deploy that capital.

We got beat out by a private equity company—and I’m not naming anyone’s names—but we were at a hundred and ninety million as an offer amount for this portfolio. And the owner calls me up—and I still talk to him today and I told him, “You did a really good job on the deal”—the owner called me up and said, “Chris, we need you to come to two-eighty. We have another group in at two-eighty. If you come to it, the deal’s yours.” And Scott, I said to him, I said, “Why are you still on the phone with me?” I said, “Hang the heck up right now and call them back and accept that offer, because I’m not coming up that high.” And they did it and they got the deal done, and I called them back and I said, “Congratulations, that’s a phenomenal deal that you did.” But that was another private equity company that needed to deploy capital, and in my opinion, they substantially overpaid. However, I don’t know their terms of their investors, all of that, but I see that more and more.

So to go back and circle with that question is: if you’re making an investment into a sponsorship group, really get to know the ownership team, really get to know the head individual who’s running it. Make sure—don’t be afraid to ask: “How’s your family? How’s your wife? How’s your kids? How’s your love life? You guys happy?” Because if they’re married, it’s important, Scott, because I’ve had business partners that got divorces, and guess who sits at the table now? Their ex-wife! Because she’s entitled at that time—she was entitled to half of it. So now I have two business partners. And so it’s important to understand that in my eyes.

When I have the team come in, I ask with the team, “Hey, how’s your life? What do you do on a personal basis? Do you like hiking? Do you have a girlfriend? Do you have a fiancée, a wife, kids? You guys happy?” Because some of that does trickle into the work environment. Thankfully, my team is firing on all cylinders: they’re all like Ferraris and/or F1 cars, I like to say. They move fast and they have the right jet fuel or race fuel inside their system. But I think that’s a very important question that investors should ask when making investments.

Scott Bursey (21:00)

Thanks for sharing how that works. Chris, as far as your network goes, how did you build the circle of people around you in this business?

Chris Salerno (21:09)

Yeah, it started out from the single-family space, where I had some investors directly buy single-family rentals from me. And they were doing it to earn and diversify their portfolio, also for tax benefits. And they came back to me and said, “Chris, we want to buy four or five more.” And I said, “Hold it. I’m now in multifamily at that time. You guys should look into diversifying in that, because you’re telling me you’re having to deal with a property manager, having to deal with this on your own. You’re too busy; you’re a high executive, you don’t need to deal with that. This is 100% passive.” And so that’s really where it started. And then we provided phenomenal opportunities at the time to investors to see and look at and diversify their portfolio. And it scaled from there and there to where now we get a ton of investors just referral-based—they’re all referrals looking to place capital with us.

Scott Bursey (22:03)

That’s a strong circle, Chris, and it sounds like you pour into it as much as you receive from it.

Chris Salerno (22:10)

Very much so. And with our opportunities yielding high tax benefits, we’ll probably have to stop capital raising at the beginning of December, because we have some deals that are closing in December and we don’t want to raise too much capital—because if we raise more capital, it’s less tax benefits for investors. And we have the majority of that capital, which is already raised, coming just from referrals.

Scott Bursey (22:31)

Chris, let’s dive deep. If a person has some cash set aside and wants their first real asset, what’s the first move you would teach them?

Chris Salerno (22:44)

Being honest—I am a very direct and blunt type of guy—educate yourself, keep that capital there. If this is your first real investment, we only work with accredited investors at our organization that have experience. If you came to me and said, “Hey, this is my first investment,” I’m gonna tell you to hold your capital; do not invest. Educate yourself at a very high level.

Thankfully, when I created the company, I was building Excel spreadsheets from scratch; now you have Claude and ChatGPT that do all of your legwork. So utilize that to gain education, understand deals at a very high level, reach out to sponsors, look at their deals, analyze their deals. And I think when you feel like the timing is right after you’ve analyzed enough deals, you got a good sense, then make that investment—if you are financially sound to lose that investment. Each investment poses risk, and I say that all the time. Look at Nvidia right now—not too good with the market, yeah. Each investment poses risk, so when you make these type of investments, you have to be willing to understand that you could lose these investments.

And so that’s why I say: really educate yourself, understand the asset class, make sure you feel comfortable in the asset class. We have investors that always try to bring us new deals. For example, one of our legacy investors—I like to call them, they’re over two-million-dollar investors with us—posed a new opportunity. He said, “Chris, I heard about this guy raising money; they’re doing it into coffee shops and it’s a 40% return.” I’m like, “That sounds a little too good to be true. Get me in touch with this guy; let me talk to him.” I’ve reached out to the guy; he’s canceled two of my appointments. It’s a little strange. I’m asking for a third one because I want to go ahead and give feedback to our investors, but that’s a little strange that right before them you cancel it—he knows my background, he understands I’m in finance.

So it’s important to do your due diligence, understand the asset class. Don’t just invest into self-storage without understanding the asset class, without understanding the risk that’s involved with it, how volatile it is. Look right now, it’s volatile: a lot of people are cutting their quote-unquote, I like to say, “junk” that they don’t need, and they’re bringing it back in their garage, they’re bringing it back in their house because they don’t want two to three, four hundred dollars a month extra payment given the current market environment. And so a lot of those are month-to-month, potentially six months if you’re lucky, one year in that space. And so understanding how volatile and highly operational that can be can impact your investment. So really do your due diligence, keep your money until you really understand the asset class and you truly feel comfortable making LP investments into deals.

Scott Bursey (25:29)

Appreciate you giving us the full picture there, yeah. And Chris, you have given us a tremendous amount of perspective on your niche here today. But is there any additional golden nugget or two that you would care to leave with our listeners?

Chris Salerno (25:44)

Yeah, I think we’re in a very unique timeframe. Really, don’t—you know, the media will tell you what you want to hear or tell you what they want you to hear, so it’s not always doom and gloom; there’s always opportunity out there. And I think what’s formed us into that private equity company that we have been formed into is that we invest in that infrastructure of daily life, which is a necessity for all humans. And so I think that is very, very crucial for us, and especially when we make investments, is: in good times and bad times, could this still thrive, and what does that look like?

Obviously, there’s times like the interest rate hike that we faced a couple of years ago and still are facing—no one predicted that. No one predicted that it would stay at the height it has stayed at. I’ve talked to seasoned individuals that have been around since 1970, and they still didn’t predict it. So there are going to be times that life throws you a curveball; investing throws you a curveball. You have to learn and be able to analyze it on that second pitch if you swing on the first one to not strike out, and at least have a ground ball, single, or double when it comes to it. So really make sure you’re analyzing it, but don’t have this doom and gloom of, “Interest rates are at an all-time high; there’s no deals to be made.” There are opportunities and deals out there to be made; it’s just depending on what industry you’re looking in.

Scott Bursey (27:02)

Appreciate that excellent breakdown. And Chris, for those of our listeners that want to keep this conversation moving, stay in your lane, or perhaps collaborate with you on future deals, what’s the best way for them to plug into your pipeline and reach you directly?

Chris Salerno (27:17)

Yeah, again, go to our website, qccapitalgroup.com. You can fill out a form. We send out now biweekly newsletters on the latest and greatest: what we’re investing in, what we’re looking at. And you’ll be able to also get information on our latest and greatest opportunities. Keep in mind we only accept accredited investors, so if you are non-accredited, it won’t even allow you into our system. So we can only work with accredited investors. So if you are accredited, that’d be the best way for you to stay on top of what we’re doing in the cutting edges of investing in the infrastructure of daily life.

Scott Bursey (27:52)

Chris, thank you for joining us on the Real Estate Pros podcast today.

Chris Salerno (27:56)

Thank you so much, Scott, for having me.

Scott Bursey (27:58)

It’s been a master class. And to our listeners, we appreciate you. If you received value from today’s episode, please subscribe. We’ll be fueling your tanks with the lineup of elite guests, just like Chris Salerno, who are accelerating and setting the pace for the rest of the industry. Until next time, keep your standards high and your vision clear. We’ll see you in the next episode, everyone.

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Express Car Wash Investing: The Depreciation Math Explained

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