Acquiring mini-storage units. Help on analyzing this deal.
Afternoon BiggerPockets Tribe! I have a 38 unit mini-storage building under contract. It is a one 2800 sq ft building facility (built in 2004) on approx. 1 acre of land. With the opportunity to build more buildings and/or offer Boat/RV storage. I had a mini-storage friend review the below with me and he essentially told me the business wasn't worth anything, that I should just offer to buy the land at market value. Realizing that is only one opinion and encourage me to prove him wrong, I want to gain additional insight for guys who have experience in self-storage. My wife and I plan to self manage.
- Self Storage Purchase Price: $169k
Current:
- Annual Income: $15,180
- Annual Expenses: $3,487
- Insurance: $1,636
- Property Taxes: $1,177
- Electricity: $762
- NOI: $11,693
Year 1 Pro Forma:
- Annual Income: $17,460
- Annual Expenses: $4,720
- Insurance: $1,220
- Property Taxes: $1,375
- Electricity: $762
- Grounds Maintenance: $1,400
- NOI: $12,740
38 Unit Breakdown (currently under market rents by $2-8/unit).
Current Rents:
- (20) 10x10 @ $45
- (14) 10x5 @ $25
- (4) 5x5 @ $15
What do you think about this deal? What expenses am I missing?