Yakima Restoration Company, 40-Year Washington Insurance-Funded Contractor

$1.6M

Revenue

$622K

SDE

3.0x

Multiple

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Full Editorial Writeup

This is a 40-year-old restoration contractor based in Yakima County, Washington, serving the Yakima Valley and Central Washington. The core work is emergency mitigation, water damage cleanup, mold remediation, contents/property recovery, full reconstruction, and insurance claims coordination. Revenue is roughly $1.56M with reported cash flow (SDE) of $622k, though EBITDA is listed at a far lower $250k, a gap that matters and needs to be reconciled.

The business sells itself as insurance-funded and non-discretionary: when a pipe bursts, a fire hits, or a freeze causes damage, the work happens regardless of the economy, and carriers foot most of the bill. Central Washington's climate adds a steady base of demand through winter freezes, summer wildfire and smoke exposure, and a mix of residential, agricultural, and commercial properties. The company is a franchise with 11 employees (8 full-time, 3 part-time), documented SOPs, a claims management platform, and established referral relationships with agents, adjusters, and property managers.

The $1.9M asking price includes $925k of owned real estate (an 8,500 SF building), so nearly half the price is bricks. Stripping real estate out, you are paying roughly $975k for the operating business, which reframes the headline 3.05x multiple into something closer to 1.5x to 4x depending on which earnings figure you trust. The $330k of inventory is explicitly not included in the asking price.

Why we like it

Earnings quality is anchored in insurance-funded, non-discretionary work where carriers pay the bulk of invoices rather than homeowners dipping into discretionary budgets. The reported $622k cash flow on $1.56M revenue implies strong margins, but the gaping spread between SDE ($622k) and EBITDA ($250k) is the single biggest question on this deal and must be reconciled before any offer.
Durability is genuine. Restoration demand is event-driven and recurring at the relationship level: the same adjusters, agents, and property managers route work to you job after job, which is far closer to an annuity than a typical project contractor. Forty years in one market has built a referral moat and carrier trust that a new entrant cannot buy quickly.
Market tailwinds are structural for this geography. Central Washington's hard winter freezes drive burst-pipe claims and summer wildfire and smoke events drive fire and air-quality remediation, giving two distinct seasonal demand drivers across residential, agricultural, and commercial property stock.
The operator advantage is real for the right buyer. The business comes with trained PMs, field techs, admin, and claims staff plus documented SOPs, so an existing contractor adding a territory or a PE platform can plug this in without needing restoration expertise. The $925k of included real estate also gives a financing anchor and controls occupancy cost.

How to improve it

Reconcile and then rebuild the earnings story in the first 90 days. The SDE-to-EBITDA spread of $372k is enormous for a business this size; map every add-back and owner expense so you know whether true normalized cash flow is closer to $250k or $622k before you commit capital.
Lock in and formalize carrier and adjuster relationships via preferred-vendor program enrollment. Restoration companies live and die by their spot on carrier referral lists, so convert informal referral relationships into documented program memberships to protect and grow deal flow.
Tighten claim cycle times using the existing AI claims platform as a selling point to carriers. Faster, cleaner, carrier-aligned documentation gets you more referrals and faster payment, so set KPI targets on days-to-approval and days-to-payment and market those metrics to adjusters.
Add or expand reconstruction (rebuild) capacity to capture the full job, not just mitigation. Mitigation is lower-ticket; owning the rebuild captures the larger reconstruction dollars on the same claim, materially lifting revenue per event without new customer acquisition.
Build a 24/7 emergency response and dispatch SOP with guaranteed response times. In restoration, whoever answers first and arrives first wins the job, so a disciplined after-hours intake process directly converts more emergency calls into booked work.
Pursue commercial and property-management contracts for a more predictable base. Commercial clients and PM firms generate repeat volume and larger jobs, smoothing the lumpiness of residential emergency work and building genuine contracted recurring revenue.
Audit franchise terms, royalties, and transfer requirements immediately. This is a franchised restoration business, so understand ongoing fees, territory rights, and whether the brand helps or hinders your carrier relationships before closing.

Diligence notes

Reconcile the $622k SDE against the $250k EBITDA line item. One of these is doing a lot of work; demand a quality-of-earnings style add-back schedule and three years of tax returns to determine what a passive owner actually keeps after a real manager salary.
Separate the real estate from the operating business in your valuation. The $925k building is nearly half the asking price, so value the operations on their own multiple and confirm the building is worth $925k via an independent appraisal, since financing the dirt is very different from financing goodwill.
Verify revenue concentration and the durability of carrier referral relationships. Ask what percentage of revenue comes from the top carriers, agents, and property managers, and whether those relationships are personal to the seller or institutional to the business.
Scrutinize the franchise agreement terms including royalties, territory exclusivity, transfer fees, and renewal. A franchise can constrain pricing, require capital investments, and complicate a resale, so quantify the ongoing cost and confirm the franchisor approves the buyer.
Investigate the $330k of inventory excluded from the asking price. Clarify whether you must buy it separately, whether it is current and usable, and how working capital and supplies will transfer so you are not surprised by a cash need on day one.
Stress-test weather-driven revenue seasonality and claim volume history. Because demand depends on freeze and wildfire events, pull multi-year monthly revenue to understand how lumpy the business is and whether a mild year could threaten debt service.

Source

Originally listed on BizBuySell. View original listing →