RV and Boat Storage Developement

Commercial Real Estate Investing
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RV and Boat Storage Developement

Ivan Leung
Commercial Real Estate Broker · Stuart, FL · Member since 2017 · 10 posts · 3 votes

Hi all,

This is a great forum and very informative answers to our inquiries.  Here is another:  we have an opportunity to acquire a piece of land, approx. 7 acres, and is zoned light industrial and has a conceptual site plan to develop a 100K ft self storage facility.  The city has given an informal "nod" to the site but it has not been formally approved.  Surrounding this location is all light industrial warehouses near the exit ramp of the major interstate.  In less than a mile away, a housing development that is set to build 10,000 houses and within 3 miles, they are set to build 20,000 homes in the next year.  A few self storage facilities are already there and are always full.  But are much smaller facilities and do not have the capacity for RV and boat storage.  Our idea is to acquire the land and start developing our vision for this in separate stages.  We own a few warehouses now and we have experience in this.  My question is how profitable is it to use some of the development for RV and boat storage as opposed to self storage.  We are located in S. Florida.  What is a typical price per square foot to develop self storage.  If we are approved for 100K sq ft facility, how should we undertake the phase development on this?  Is it a smart option to partner with PODS or another big storage company to lease the land?  What do we need to watch out for?  Thanks for any and all input.

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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y

@Danny Redding  50 to 60 feet elevation change is quite a bit . Thats a LOT of dirt .  A topsoil screen , sell topsoil , if its sandy , screen sand , if its rocky , sell stone . If its wet get stuck . 

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Ivan Leung

    I have a friend in North Ga that recently purchased a boat/rv storage facility that was in foreclosure. He has NO storage units. Only parking. Some covered, some not. He is across the street from a boat ramp to a large recreational lake in a very affluent area. Nearly every home is in a subdivision and has an HOA that does not allow for rv/boat storage on the same property as the residence, requiring homeowners to find outside storage.

    What was a 50-60% occupied and under foreclosure property, he was able to turn into 95+% with a little cleanup and marketing.

    I do believe he has a wash area and rv tank dump as well.

    He had 30 years experience in the automotive and software industry and literally overnight had $20-30k a month coming in. He jokes that he works about 20 hours a week now and everything is online so he doesn’t even have to see a tenant to rent a space to them.

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Ivan Leung

    I’d be sure to offer a significant amount of covered parking due to the sun and weather in Florida. And be sure to have enough insurance to cover every asset being stored in case of a worse case scenario hurricane situation where there is a 100% loss.

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  • Michael Wagner
    Specialist · Victor, NY · Member since 2013 · 823 posts · 844 votes
    7y
    Originally posted by @Danny Redding:

    @Ivan Leung

    I’d be sure to offer a significant amount of covered parking due to the sun and weather in Florida. And be sure to have enough insurance to cover every asset being stored in case of a worse case scenario hurricane situation where there is a 100% loss.

     It is not typical for a storage facility's insurance to cover the belongings of those storing them.  Each customer will be responsible for providing insurance of their things.  

    To answer some of your other questions, typical costs to build a "standard" storage facility is $30-35 per square foot plus the cost of land. We've done a good bit of RV/vehicle storage and it is a great "space holder" while you build out your property and also offers some "diversification". That said, we have always found that cannibalizing the outdoor space if demand for typical storage is there always wins out.

    I don't think pods is a good option for you at the start as that is an entirely different business model. Perhaps you are just meaning to ask about 3rd party management companies that brand the property as one of the big REITS (Cube Smart, Extra Space, etc)?  IF so, that is certainly an option on a facility this size.  Your phase one would likely need to be 30-40K sf for them to get excited.

    Hope some of that insight is helpful.  Of course take it all with a grain of salt as I generally play with the smaller facilities.

    Mike

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  • Ivan Leung
    OP
    Commercial Real Estate Broker · Stuart, FL · Member since 2017 · 10 posts · 3 votes
    7y

    Danny,

    Thank you so much for your input.  I will keep all of your great advice in mind.

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  • Ivan Leung
    OP
    Commercial Real Estate Broker · Stuart, FL · Member since 2017 · 10 posts · 3 votes
    7y

    Hi Michael,

    Thanks so much for your input.  We mainly are looking to develop just a portion to be RV/boat storage with overhang, water and electric.   We are calling all the surrounding facilities and they are always full.  I agree with you about the space holder land.

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  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    7y

    I have a customer who owns one , its commercial , its a stone lot with a 6 ft fence and an automatic gate , he has 70 Rvs at $100 a month . He is full with a waiting list . He was going to build it out and rent the building , but  he figured out he can make as much or more just renting out spots .  

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  • Adam Johnson
    Rental Property Investor · Holley, NY · Member since 2011 · 507 posts · 347 votes
    7y

    My two cents regarding phasing that has been already touched on by Michael - the outdoor storage is probably the cheapest per sq. ft. to develop.  If you design your site ahead of time and get the grading work done as if you were going to add buildings in that area in the future, you can provide outdoor storage on the subgrade stone/gravel base (unless the municipality requires paving).  Going this way also gets your toes in the water without jumping all in too.  After you open with some storage space and some outdoor storage space, you can see what the demand is at YOUR location, then continue developing it with that in mind.  

    While not having the RV storage covered reduces the value of that storage space, it also reduces your upfront development cost and leaves you with maximum flexibility.  For example, if you build a 20,000 sq. foot canopy space to park RV's under and later find the demand and return is much higher for traditional storage space, you may find that the higher canopy is more expensive to convert and wastes vertical space (traditional storage space has much lower ceiling height than RV).  Alternatively in this example, if you grade for that same 20,000 square foot canopy, but don't actually build it and simply use the stone base for outdoor storage, you are not committed.  You can do a lot of things in a few years.  

    I would look at it from the point of view that, at this point, you want to maintain some flexibility with the square footage of land, or at least part of it, as opposed to trying to guess how your potential customers might want to use square footage of building space.

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Michael Wagner

    I come from the auto industry myself where storing vehicles must be covered under garage keepers liability since you’re responsible for the vehicles on the property.

    I’ll definitely look into the waiver type option where the customers maintain the insurance. In GA, trailers are not required to carry separate insurance since they are covered under the towing vehicles insurance. But that only covers while physically attached to the towing vehicle.

    I have 10 acres in middle Georgia in a growing area where I am looking at developing a similar facility. Unfortunately, I have a significant grade that will force me to build terraces and more than likely include a retention pond as well. Not to hijack this thread but I’d be interested to see others ideas of how they overcame issues similar to mine. 50-60 foot elevation difference over a L shaped 10 acre parcel with the lowest elevation being the angle of the L.

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  • Michael Wagner
    Specialist · Victor, NY · Member since 2013 · 823 posts · 844 votes
    7y

    @Danny Redding,

    It all comes down to your agreement with the renter's.  You need to spell out the terms and responsibilities of each party.  Generally speaking in the storage world, the customer remains responsible.  Of course state laws may vary and they would trump this!

    As for your elevation challenges, I am not an expert but have done a bit of development and flattening out your parcel might not be as crazy as it would appear on the surface.  My understanding is that flattening a parcel with varying elevations is not all that costly IF (and this is a BIG IF) you can do so without dump trucks...the import and export of material is the greatest cost so if you can simply move the high ground dirt to the low ground and create a happy medium, you can offset a good bit of the costs....And if you do need to export material bc you have too much, a parcel that size might allow you to sell off the material to mitigate your costs...I'd recommend talking with some experienced excavators who are open to the idea of helping you flatten your parcel in exchange for money and the right to "sell" your excess material.... just some ideas to get the ball rolling!  Good luck.  Ive got a couple places in Georgia myself, one in Tifton and one in Hinesville.

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Michael Wagner

    Definitely good advice. I have already been able to profit off of the timber. Of course that left a major mess. Thankfully I do have a skid steer myself and have a couple friends with dozers. Just a matter of time and money!

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  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    7y

    @Danny Redding  50 to 60 feet elevation change is quite a bit . Thats a LOT of dirt .  A topsoil screen , sell topsoil , if its sandy , screen sand , if its rocky , sell stone . If its wet get stuck . 

    2Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Danny Redding:

    @Michael Wagner

    I come from the auto industry myself where storing vehicles must be covered under garage keepers liability since you’re responsible for the vehicles on the property.

    I’ll definitely look into the waiver type option where the customers maintain the insurance. In GA, trailers are not required to carry separate insurance since they are covered under the towing vehicles insurance. But that only covers while physically attached to the towing vehicle.

    I have 10 acres in middle Georgia in a growing area where I am looking at developing a similar facility. Unfortunately, I have a significant grade that will force me to build terraces and more than likely include a retention pond as well. Not to hijack this thread but I’d be interested to see others ideas of how they overcame issues similar to mine. 50-60 foot elevation difference over a L shaped 10 acre parcel with the lowest elevation being the angle of the L.

    I suspect unless you can get dirt work done very cheap this will not pencil..  that's a lot of drop from one side to the other.  

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Danny Redding:

    @Michael Wagner

    Definitely good advice. I have already been able to profit off of the timber. Of course that left a major mess. Thankfully I do have a skid steer myself and have a couple friends with dozers. Just a matter of time and money!

    if the site balances that's one thing.. but I suspect that might not be the case.. and if you now have to pull stumps.. you going to have a ton of material.. but I am all about logging.. being an ex logging concern here in Oregon.. I would go find more timberland and forget all this other stuff.. that's the best and the most fun and quickest money :) 

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Jay Hinrichs

    The logging company I used looks to have gone out of business. And I had issues with them anyway with the servicing of equipment on my land when things failed. I made them dig out the dirt they contaminated with hydraulic oil when a line burst on a feller buncher. My educational background is in Geology and the last thing I wanted was an EPA violation due to their negligence and lack of maintenance.

    I don’t see many companies around my area doing logging. Mead and GA Pacific have large leases for timber land and they harvest in house I believe.

    Once I make a road access to the land, I’ll place a “fill dirt wanted” sign at the road. Lots of people need places to dump loads after they’ve excavated other areas. If it takes a year but the dirt is free I’d think it’s a win-win.

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  • Matthew Paul
    Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
    7y

    @Jay Hinrichs  You really want to confuse people , most have no clue about "balancing a site ".      

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    7y
    Originally posted by @Danny Redding:

    @Jay Hinrichs

    The logging company I used looks to have gone out of business. And I had issues with them anyway with the servicing of equipment on my land when things failed. I made them dig out the dirt they contaminated with hydraulic oil when a line burst on a feller buncher. My educational background is in Geology and the last thing I wanted was an EPA violation due to their negligence and lack of maintenance.

    I don’t see many companies around my area doing logging. Mead and GA Pacific have large leases for timber land and they harvest in house I believe.

    Once I make a road access to the land, I’ll place a “fill dirt wanted” sign at the road. Lots of people need places to dump loads after they’ve excavated other areas. If it takes a year but the dirt is free I’d think it’s a win-win.

    Ok little hydraulic oil really..  ?  WE ran 4 to 6 sides for 10 years.. moving 5 to 10 million board feet of doug fir a year.. if we got on our loggers for a little oil spill.. heck who has time for that. plus they would have looked at us like we were nuts.. I mean this is not like a gas station with a leaking gas tank for 25 years.. I have never seen a logging show that there was not some oil or hydraulic fluid spilled somewhere that just goes part and parcel with big iron

    also on the fill situation that can take years and years to get clean fill put in there then it has to settle as you will want to make compaction you just don't dump dirt spread it around and wa la your ready to go.. other wise you have to bring it in  in lifts with water and compactor .. like dozer sheep foot vibrator rollers etc.. but if the city or country does not care its your risk for ground movement 

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  • Danny Redding
    Specialist · Columbus, GA · Member since 2018 · 28 posts · 13 votes
    7y

    @Jay Hinrichs

    Might I also add that I had horses and a wife who was adamant that the horses were not to eat hydraulic oil.

    It was more of a stipulation prior to them accepting the job, to make sure they cleaned up after themselves. Watching how they operated, it’s a wonder they were in business as long as they were.

    Thank you for the advice and guidance. I definitely have a lot to consider. The land is paid for so I hope I can find a creative contractor/engineer that can utilize what is there into a more worthwhile investment than the bare land.

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  • Lance Langenhoven
    Real Estate Broker · The Woodlands, TX · Member since 2016 · 63 posts · 28 votes
    7y

    @Ivan Leung

    Sounds like you have a good site for boat & rv storage. Storage in general. 

    Here in the Houston area we are getting around $0.85 p/sf rent for self-storage without AC. If you add AC then the units rent for at least $1.00 p/sf, sometimes a bit more. 

    Boat & RV rents here are approximately: 

    - $0.10 to $0.12 for outdoor space on crushed concrete

    - $0.22 to $0.25 for covered / open RV parking (12 x 45)

    - $0.32 to $0.45 for covered / lockable RV storage (12 x 45)

    I think the other recommendations to start with outdoor storage is a good one. You can always add higher-quality storage down the line if your tenants show an interest. 

    That way you can build the other infrastructure first.... fencing, gates, access control, cameras, management system and all the expenses that don't really generate direct income but still have to be done. 

    Depending on how you build the RV storage buildings your costs can range quite a bit. Pre-engineered buildings with a GC running the job will cost the most. If you don't hire a GC & just design the buildings & buy standard steel components & weld them together your costs can be reduced quite a bit.  Really depends on what end product you're trying to create. 

    Good luck!

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  • Kyle Ferguson
    Developer · Amherst, MA · Member since 2018 · 35 posts · 7 votes
    7y

    Does anyone on this thread use GIS to find land the right parcels to develop into RV and Boat storage?

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  • Matt Brown
    Rental Property Investor · Nolanville, TX · Member since 2008 · 130 posts · 88 votes
    7y

    @Kyle Ferguson

    I'm working on this. Found some land on MLS and backed it up with the county CAD.

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  • Kyle Ferguson
    Developer · Amherst, MA · Member since 2018 · 35 posts · 7 votes
    7y

    @Matt Brown

    Smart man. If you need any help let me know (: 

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  • Anthony Berk
    Member since 2021 · 2 posts · 0 votes
    5y

    Hello guys. I have some questions from a post 2 years ago. Someone told me my prices would be much more then I figured to build. Who did you use for the building? Do you have a contact there? Does that include everything from slab to lights? Trying to figure out whether to buy this 1.3 acre for 325k. Its a more expensive area but right off the highway. The price of the property doesn't bother me. Its the building. All help is appreciated. Did you do medium duty steel or heavy? I want to put two buildings 20x50 size. Totaling about 20k sqft

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