Hawaii HVAC & Sheet Metal Fabrication w/Real Estate

Profitable and growing construction & fabrication business

We are presenting an extraordinary opportunity to own a successful HVAC and sheet metal fabrication business, inclusive of its fee owed real estate (office, fabrication shop and warehouse), in the heart of Hawaii’s paradise. This well-established, long tenured, 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. Their current scope of work is about 59% metal fabrication and 41% HVAC services.
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. Their future demand looks strong.

In 2023 their sales were $3.09 million which generated $554,507 of Seller’s Discretionary Earnings (“SDE”) after normalizing for market-based lease rent (income tax return-based data).

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 new, centrally located industrial park. By owning this real estate, the Business owner saves $194,400 per year in third-party lease rent.

For the YTD November 30, 2024 period, their sales were up 13.6% to $3.04 million which generated lease rent normalized SDE of $734,419 and total cash available for business and real estate debt service of $912,619.

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 (which is about the Business’s amount of SDE for 11 months in 2024), 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 9-person operating team (excluding the owner)
• Strong backlog
• 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.