@Jared Hartley I can help. Feel free to PM me with your email address and I would be happy to discuss with you....
We are a top 30 self storage operator in the U.S. and have done quite a bit of development.
Originally posted by @Jared Hartley :
I have 2.4 acres I want to build self storage on and want advice . How to figure the deal so it is win win. Who and how to present to potential partners or investors.
1. I own the land 2. I operate another business on site (painting company) 3. It is on a new main road in our town new viaduct adjacent to with walking path and great neighborhoods in all directions. 4. Only one in this corner or quadrant of the community.
I need a mentor for question and specifics. PLEASE ADVISE.
Definitely reach out to @Kris Benson as he is very knowledgeable in this sector. I would also be happy to talk storage with you. My bread and butter is more in purchasing under performing properties, optimizing them and then developing/expanding to meet market demand. Ground up development brings with it a host of additional considerations (some of which are pros and some of which might be sticky points but are certainly navigable!). Either way, it is a great industry and can be incredibly lucrative IF you do it right:)
I'm a little late to this thread but we have quite a few Development (and Conversion) Deals in the works and also conduct a 3-Day Developers Academy.
We, too, normally recommend value-added existing Facilities but sometimes it does make more sense to build than to buy. Please note that there are a lot more moving pieces with a Development than an Existing Facility plus a lot more upfront costs and the time conundrum (it's going to take several years before it begins to generate an income). However, if you can think big picture and wait for your investment to pay off - it can certainly be in your best interests & lucrative, as well.
However, this is not necessarily a "build it & they will come" approach as you'll need to first conduct a market study & competition analysis (specifically a Supply Index) to determine if it makes sense to move forward, and if your numbers are favorable you'll need the opinion of a neutral third party to conduct a Feasibility study.
Plus you'll want to pencil out the expected capital expenses (prep & grading of land, architecture & engineering fees, cost to build, soft costs, working capital) and offset against the estimated revenue - when it is operating as a stabilized Facility. And also, please factor in the timeline that all of this happens. (I personally recommend not using best-case numbers but either worse-case, or better yet "most realistic" - be conservative with your projected numbers.)
Plus zoning - definitely make sure that it is zoned for Self Storage, too.
(I kind of gave you the shotgun approach intentionally just so you realize that there are lots of moving pieces, but if you organize your thoughts & to-do's and systematically tackle them, you can succeed. And yes, it would certainly behoove you to have a mentor - someone who has been down this road before.)
Best of luck!
What is the vacancy rate with the competition? How many square feet of existing and proposed self-storage already exists? How does that compare to the number of residential units in the area? I believe a good rule of thumb is below 6-7 (?) square feet of storage per residential unit is a good gauge of the need.
@Jared Hartley I know i'm late to this thread, but your situation sounds very similar to mine. Did you ever build the self storage units?
Is the project shovel ready, permit approved? Do you have a recent appraisal with the current AS IS value? Depending on those answers 100% construction financing may be available to you.