All Forum Posts by: Lance Langenhoven

Good stuff Joshua. Here in Houston I'm leasing out fully enclosed boat & rv spaces that are 12' x 45' for $0.32 p/sf at my existing location. Self-Storage (smaller spaces) in the North Houston area leases out for about $0.85 p/sf and if you add AC they get at least $1.00 p/sf and in some case up to $1.15 p/sf. 

I just checked a new self-storage place that opened near a new boat & rv storage facility I'm busy building and their biggest space is a 10' x 30' with a 9' wide by 7' tall roll-up door and they're asking $0.63 p/sf for that. 

So, I'm pretty happy because my project is projecting a cap rate of 21% based on development & land cost and my projected rent is only $0.36 p/sf!!!! But, I do have some small-office warehouse also which has better rent p/sf so that definitely sweetens the returns. 

Wow! Great move @Joshua Watts! Congratulations. That cash flow is just incredible considering it's your first year owning it and you financed it 100%..... super smart strategy to corner the market in your area and definitely worth the quarterly phone calls over two or three years. 

I'm not purchasing my next one, I'm building it! But I do boat & rv storage with a bit of small-office warehouse mixed in. So, slightly different to traditional self-storage but it's very easy to manage which is what I like - minimum responsibilities. 

Hi @Justin Frank,

You seem to be seriously concerned about whether this area is right for you to invest in. If you were a women you would most likely have pulled out of this deal by now. Women seem to have a sixth sense about risky ventures that men often simply ignore. To their detriment. 

In my investing I've tried to cultivate this sixth sense and in fact I often run investment ideas past my wife as she gives me a different perspective that I hadn't even thought of. 

Warren Buffet has in the past said something like, imagine that you only have 20 opportunities in your life to invest, so, don't waste even one of them on a speculative deal. Make each deal count. Something to that effect. 

The point is,  once you're tangled up in this deal you've used up one of your investing slots and it could be a while before you get another opportunity. Remember, the seller has only that property he wants to sell but while you have your cash you can buy any property anywhere. 

So, without knowing Aberdeen, but based on your concerns, I would say keep looking. 

A great deal should be green flags all the way and you should be 150% confident that it will pay off really well. Your wife will be happy, your bank will be happy and you'll be happy!

Good luck! 

ps - also, $5,000 for the feasibility is a lot of money to sink into the deal. See if a local commercial real estate broker that focuses on storage is not able to give you some advice about the location. That's not going to cost you a dime. 

Hi Allison, 

If I was you I would list this with an agent. They will bring far more exposure to the listing and more exposure means a better offer. Also, a good agent will now how to present the property in the best light. That's worth the commission any day. 

The thing to do is to find a good agent that you can work with long-term if you want to continue investing / flipping deals. They need to be more than an agent... they need to become your friend so that you can get their advice / help as you build your portfolio. Interview a few and see who you feel comfortable with. 

It costs to use an agent but they take a lot of work off your plate and good agents make things happen. 

If you research the stats you'll find that most FSBO sellers eventually give up and list with an agent anyway.

Good luck!

@Greg Gibson - I would go with what @Allison Nog is suggesting. Maybe explore a little more with her on how she's doing what she's doing. I wouldn't invest with 3rd-party operators, syndication deals, crowdfunding or whatever they want to call it. Do it yourself or maybe one 50/50 partner. Good luck!

I own a boat & rv storage facility which, unlike self-storage, does NOT require on-site management. We have close to 100 tenants now and handle new prospects, sign-ups and day-to-day management all remotely with part-time help from my brokerage administrator that does double-duty for the boat & rv storage business. 

I do visit the property occasionally, no more than once a week but sometimes once every two weeks - just to see if the yard has been mowed and make sure everything looks ok.  

@Earl Hatmaker Hey Earl.... one thing you can do is don't let him pay for the coffee or lunch. If you're meeting him at his office then I would ask him if you could meet him for lunch the following week, your treat - as a thank you. Of course that gives you another hour of discussion! :) 

Yes.... as the others have said.... just be you. Show a real interest in what he's achieved and ask tons of questions - If he's a normal human being he would just love to explain "how I did it" to anyone who would care to listen. 

Good luck!

@Erik Schneider, I second what @Lane Kawaoka said about another asset class like mobile home parks, self-storage or boat & rv storage. Self-Storage & boat & rv storage specifically are much easier to manage as there are no people living on the property.... it's essentially multi-family without the family! 

I think what you're really looking for is multi-unit investing so that you have many tenants diversifying away your risk vs 1 or 2 large tenants. Multi-family is not the only multi-unit investing strategy out there. 

@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!

Notice that you're both Texas & looking for self-storage. Are you looking to purchase existing self-storage or are you thinking of developing from scratch? - @Seth Eaton and @Mak K.