Advice on investing in Storage Units

[Benn Maddox]

I have the opportunity to purchase 17 Storage units for $25,000, with a monthly income of $685, What pros and cons do you see with this type of investment? 

[Vlad Kolbas]

Hi Benn, storage units have been a great investment for me and my business partner. We started in residential real estate and still own over 50 units but have ventured into self storage last year when we purchased an existing facility with 77 units in south east Nebraska to learn the business. Now we are developing and purchasing more facilities.

It's so much easier dealing with turn over than in residential, just sweep out the unit and re-rent. It's also easier to deal with delinquent tenants. While it's not a totally passive investment, neither is residential since there is always something somewhere that needs to be fixed. With self storage you mostly get calls if someone wants to move in or move out since there is really nothing that needs to be fixed regularly.

While you provided limited information, those numbers look attractive. You should investigate other self storage in the area to see their rates, occupancy levels, etc. and how they compare with this facility. Managing 17 units should be very simple, especially if you live fairly close.

Good luck and let me know if you have any other questions I can help you with!