Looking at a property with potential for a self storage facility. What are your thoughts?? Would have to build new or re-purpose an existing structure. There is a self storage place in a neighboring town within 5 miles, but it's full. Nothing available in the town we are considering... Thanks!!
Do the following steps:
1. Determine your financing capacity. Narrow down the size of investment you can do. How much collateral or cash do you have? Lets say $150,000. Determine your financing method. SBA 10%; SBA 15%; Conventional 25%; Conventional 40%. If your doing a Conventional 40% then your target is a total investment of $375,000. If SBA 10% then $1,500,000.
2. Kennedy, New York is in Western side of New York State, correct? This makes it simple then, since these are smaller, well defined towns. Google Self Storage for Jamestown or Randolph. Select the Map view in the upper left. Move your cursor around and identify all of the storage locations per town. Go take and inventory of their unit numbers, sizes and prices.
3. Same as above, but go to Sparefoot. Do the same thing and click on the map. Get the prices by size for the ones using Sparefoot. Not everyone uses sparefoot.
4. By town, do the following. Jamestown, NY has a population of 29,500. Use a ratio of 6 units to 100 people. Jamestown has a market capacity of roughly 1,800 units. Even more if there are a lot of people outside of the city limits.
5. Compare your count from 2/3 versus the 1,800 units. If Jamestown, has 1,400 units versus a capacity of 1,800; then you should build there.
6. If Jamestown, has 2,000 units but they are all on the West side or some other side of town; then you should build on the other side of town if that is where a lot of population is. Yes the town has to much capacity, but you have out positioned them. People will use storage closer to them versus travelling far.
Always try to Buy first and build second. Go to all of the storage locations and make them an offer. Gets you into the business without going through the development curve. Takes out competition. If you build in another location later, you have Rent price control, with the more locations you own in a general area.
Start small and Make Your Big Mistakes Early.
I'd suggest joining @Michael Wagner 's Storage Rebellion forums. Great content and knowledge specific for storage networking. You can learn how to assess the demand for storage in the area and meet others who have done this type of development.
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you