All Forum Posts by: Scott Meyers

Hi Belinda,

I'll take a stab at it, as these are areas we either add to our Self Storage Facilities, or they can be stand alone Real Estate Plays:

24. Parking Lots/Garages

25. Billboard Parcels or Cell Tower Parcels and the corresponding rentals of the towers and boards.

26. Industrial buildings/Cold Storage/Warehousing

27. Marinas

28. Golf Courses

29. Campgrounds/RV Parks

28. Retail Strip Centers

29. Buying Old stretches of Railroad or Spurs.....

Yeah, I know, some are a stretch, but ALL of these are Real Estate Plays that I, or someone I know has invested in.

If these weren't part of his list, then I guess we now have 34!

Talk Soon,

Ditto - Glad to see we now have a place to connect.

We are primarily Self Storage Investors who raise private capital to acquire either existing facilities, or vacant land to develop, and Industrial buildings for conversion to Self-Storage. We have participated in dozens of projects all over the country, and have a very active group of investors with an appetite for more. I am also an author, National Speaker, and Consultant for the Self Storage Industry.

I Look forward to helping in any way I can here in the Syndication Forum.

Talk soon,

Darren,

The best approach we have found is to create a syndicate or pool of investors, for each property, with a specific time period, usually 5 years. It is not fluid or flexible to allow investors to come and go as they please. It also costs us around $10,000 to $12,000 to set up. We are investing in Self Storage Facilities in the $500,000 to $2M range so the fees are simply the cost of doing business, and we gladly pay them to avoid the bank, and to allow us to 10X our business. If you want to stick with houses and small multi-family, then partnerships are the most flexible, but also risky, as there really isn't any protection for you, like you would find as the General Partner/promoter in a syndicate. And I would give SERIOUS consideration before simply entering into a partnership with friends and family on some single family rentals. Many, Many investors have crashed and burned with this method, and lost friends and damaged family relationships. I've seen it dozens of times. If there's anything to take away from this, it's to leverage your time, and buy bigger properties with more investors, rather than going through the same amount of work to buy single family homes. You've already begun to climb the ladder into commercial, why go backwards?

My $.02

Dan, Yes, I am familiar with the SBA 7a - used it many many times - It was made for Storage! Be certain to ask the lender you begin to work with how many 7a loans they've closed. Many say they know how to underwrite them and get them funded, but few actually do.

Your offer and terms for the buyer sound good, if he agrees to the terms.

I'll state again, I'm not a big fan of a 6% cap rate unless there is SIGNIFICANT upside to be realized in the immediate future, and additional value over the long haul, but each investor sees a different intrinsic value in a deal.

Keep me posted!

Peter,

I would never oppose a formal education, and if you plan to be in the business, this might open doors for you.

However, along the way, I would devour every real estate book, podcast, and attend real estate seminars and conferences to learn the investment side of the business.

I have a BA from the University of Michigan with a concentration in Marketing, and although I learned a great deal about business, my formal education didn't prepare me to run my own one day.

I learned the investing side by doing the things I mentioned above - attending seminars, networking, and paying mentors/coaches - and oh yeah, jumping in and buying a property.

I would also suggest you pick an asset class that excites you, before just buying a house to rent because "everyone else started here". In addition, It helps to at least build a team of lenders, attorneys, and other advisors prior to launch. However, don't wait too long or become prey to paralysis by analysis (or whatever the phrase, you know what I mean). Too many of my students spend months planning, but never launch.

Aim, then PULL THE TRIGGER.

And as always, feel free to jump on here to ask a question from your unpaid, but highly professional board of real estate advisors!

Keep us posted on your progress.

Not to toot my own horn, but as far as I know, I am the only person ever successful in evicting Jetz from one of my apartment buildings I owned many many moons ago.

Their lease provides that they actually pay rent for space in your building. If they haven't paid, you can take them to court and "evict them" for non-payment of rent.

I did, and I Won!

The president of Jetz was so impressed that he flew to Indianapolis to have lunch and work things out. We did, and actually became friends through the whole ordeal.

More of a story than anything, but maybe you can glean something from this that will help.

And not to sound like a broken record, but laundry leases, tenants, toilets, and trash and everything else that goes with apartments is what led me to sell over 100 houses and 400 apartments and invest in Self-Storage.

I have 5,000 units, and 1/100th the headaches of 500 rental units!

Good luck.

Hello Gentlemen,

Ditto - We play in the same sandbox as the both of you - primarily in Self -Storage, and Industrial buildings that could be converted to Self Storage.

We're also in acquisition mode as well - Just closed on a bank owned, 10% occupied facility in New Jersey last Friday, and Flying to Texas do do due diligence on another under performing Self-Storage facility this Friday.

We mostly syndicate our deals so that we can avoid the banks, move quickly, and take advantage of the "unfinanceable" deals. (no, it's not a word, but you know what I'm talking about - 0% cap rate, distressed, etc.)

I'll throw my hat in the ring to be a part of the conversation as well, but completely understand if three's a crowd.

Nice to "virtually" meet the both of you, Richard and Tim.

Have a great weekend!

Hi Stephen,

We've bought, developed, and sold over 2,500 units and 400,000 sf of Self Storage and our Self Storage Education and mentoring business has participated in dozens of deals nationwide totaling well over 3 million square feet. Safe to say we know and Like the business - and John is correct, IT IS A business.

However, I've owned about a hundred single family rentals and over 400 multi-family properties - and it was the darkest period of my journey as an entrepreneur. I'm sure there are several here who will both concur, and disagree. I have sold all my homes, apartments, retail buildings, office buildings, warehouses, and parking lots - to focus in nothing but self storage. Do your research - Self-Storage has outperformed all other real estate asset classes for the past 10 years hands down.

I decided if I wanted to succeed, I better begin investing in the most successful asset class. Pretty simple really.

Tenants, toilets and trash will erode your profits like the proverbial thief in the night, and finding a good manager or management company is next to impossible.

Either way, choose what you're passionate about once you've done your homework. I will point out however, that if you're comparing a vending route to Self Storage, you are forgetting all the benefits of the real estate: appreciation, depreciation, mortgage buy down, etc.

Okay, I could go on and on, and perhaps I'm a little bit biased since I own several companies that all specialize in Self Storage, but after investing in virtually every asset class in real estate - I have found Nothing, and I mean nothing that produces the consistent cash flow, and returns, with the fewest hassles, Than self storage. Just steel walls and roofs on a concrete slab where people come and use a kiosk to rent a unit.

Hi Ginger and Ryan,

Thought I'd add my $.02. Ryan, you are CLOSE in calculating the value of a Self Storage Facility by using a 10% cap rate (dividing Actual NOI by .10) but of course the facility class, market, and current cap rates in the market will dictate which to use: 9%, 8%....

As for Kiosks, there are many ways to evaluate whether you will get the ROI. Generally speaking, it's tough to see the return for a facility with less than 100 units. We usually don't look to utilize them at any of our facilitites below 150, and most likely 200 or more makes the most sense.

Hope that Helps

Nick, we are focusing on turnaround projects and/or converting warehouses, supermarkets... to Self-Storage. Properties in the 10-40% occupancy range or conversions with $0 cash flow and 0% cap rates. Banks don't like that.

However, since we're buying troubled assets from the bank with cash, we are able to pick 'em up for pennies on the dollar (literally).

Cash flowing properties that are somewhat stabilized and a decent cap rate - then yes, we'll definitely bring in bank debt and syndicate the down.

Good chatting.....